| Nature of Operations and Summary of Significant Accounting Policies | Nature of Operations and Summary of Significant Accounting Policies Nature of Operations Kadant Inc. was incorporated in Delaware in November 1991 and trades on the New York Stock Exchange under the ticker symbol "KAI." Kadant Inc. (together with its subsidiaries, the Company) is a global supplier of high-value, critical components and engineered systems used in process industries worldwide. Its products, technologies, and services play an integral role in enhancing process efficiency, optimizing energy utilization, and maximizing productivity in resource-intensive industries. COVID-19 The ongoing COVID-19 pandemic has negatively affected the global economy, disrupted global supply chains, and resulted in significant travel and transport restrictions, which adversely affected the Company’s bookings and financial results for a substantial part of 2020. The impact of the COVID-19 pandemic, including the resulting economic impact, continues to evolve and the Company is closely monitoring its impact on all aspects of its business and will continue to take actions that are in the best interests of its employees, customers, and stakeholders. Noncontrolling Interest One of the Company's foreign subsidiaries that manufactures fluid-handling products is part of a joint venture agreement with an Italian company in which each holds a 50% ownership interest. The agreement provides the Company's subsidiary with the option to purchase the remaining 50% interest in the joint venture. Principles of Consolidation The accompanying consolidated financial statements of the Company include the accounts of its wholly and majority-owned subsidiaries. All material intercompany accounts and transactions have been eliminated. Fiscal Year Typically, the Company's fiscal quarters and fiscal year consist of 13 and 52 weeks, respectively, ending on the Saturday closest to the end of the corresponding calendar quarter for its fiscal quarters and on the Saturday closest to December 31 for its fourth fiscal quarter and fiscal year. As a result of the difference between the fiscal and calendar periods, a 53rd week is added to the Company's fiscal year every five or six years. In a 53-week fiscal year, the Company's fourth fiscal quarter contains 14 weeks. The Company's fiscal year ended January 2, 2021 (fiscal 2020) contained 53 weeks and its fiscal years ended December 28, 2019 (fiscal 2019) and December 29, 2018 (fiscal 2018) both contained 52 weeks. Each quarter of fiscal 2020, 2019 and 2018 contained 13 weeks, except the fourth quarter of 2020, which contained 14 weeks. Financial Statement Presentation Effective at the beginning of 2019, the Company adopted Accounting Standards Update (ASU) No. 2016-02, Leases (Topic 842) (Topic 842), using the cumulative-effect adjustment method. Consolidated statement of income amounts and disclosures in 2020 and 2019 are presented under Topic 842, while 2018 is not adjusted and is reported under the Company's prior method of accounting for leases in accordance with Accounting Standards Codification (ASC) 840, Leases (Topic 840) (Topic 840), which is allowed under the transition guidance in Topic 842. Effective at the beginning of 2020, the Company realigned its business segments into three new reportable operating segments: Flow Control, Industrial Processing, and Material Handling. The Company previously reported its financial results by combining its operating entities into three reportable operating segments: Papermaking Systems, Wood Processing Systems, and Material Handling Systems, and a separate product line, Fiber-based Products. Financial information for 2019 and 2018 has been recast to conform to the new segment presentation. See Note 12 , Business Segment and Geographical Information, for further detail regarding the Company's segments. Use of Estimates and Critical Accounting Policies The preparation of financial statements in conformity with U.S. generally accepted accounting principles (GAAP) requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenue and expenses during the reporting period. Although the Company makes every effort to ensure the accuracy of the estimates and assumptions used in the preparation of its condensed consolidated financial statements or in the application of accounting policies, if business conditions were different, or if the Company were to use different estimates and assumptions, it is possible that materially different amounts could be reported in the Company's condensed consolidated financial statements. Critical accounting policies are defined as those that entail significant judgments and estimates, and could potentially result in materially different results under different assumptions and conditions. The Company believes that the most critical accounting policies upon which its financial position depends, and which involve the most complex or subjective decisions or assessments, concern income taxes, revenue recognition, the valuation of goodwill and intangible assets, and inventories. A discussion of the application of these and other accounting policies is included within this note. Revenue Recognition The Company recognizes revenue in accordance with ASC, Revenue from Contracts with Customers (Topic 606) . Most of the Company’s revenue is recognized at a point in time for each performance obligation under the contract when the customer obtains control of the goods or service. Most of the Company’s parts and consumables products and its capital products with minimal customization are accounted for at a point in time. The Company has made a policy election to not treat the obligation to ship as a separate performance obligation under the contract and, as a result, the associated shipping costs are reflected in cost of revenue when revenue is recognized. The remaining portion of the Company’s revenue is recognized on an over time basis based on an input method that compares the costs incurred to date to the total expected costs required to satisfy the performance obligation. Contracts are accounted for on an over time basis when they include products which have no alternative use and an enforceable right to payment over time. Most of the contracts recognized on an over time basis are for large capital projects. These projects are highly customized for the customer and, as a result, would include a significant cost to rework in the event of cancellation. The following table presents revenue by revenue recognition method: (In thousands) January 2, 2021 December 28, 2019 Point in Time $ 557,702 $ 611,528 Over Time 77,326 93,116 $ 635,028 $ 704,644 The transaction price includes estimated variable consideration where applicable. Such variable consideration relates to certain performance guarantees and rights to return the product. The Company estimates variable consideration as the most likely amount to which it expects to be entitled based on the terms of the contracts with customers and historical experience, where relevant. For contracts with multiple performance obligations, the transaction price is allocated to each performance obligation based on the relative stand-alone selling price. The Company disaggregates its revenue from contracts with customers by reportable operating segment, product type and geography as this best depicts how its revenue is affected by economic factors. The following table presents the disaggregation of revenue by product type and geography: (In thousands) January 2, 2021 December 28, 2019 December 29, 2018 Revenue by Product Type: Parts and Consumables $ 417,545 $ 440,699 $ 374,433 Capital 217,483 263,945 259,353 $ 635,028 $ 704,644 $ 633,786 Revenue by Geography (based on customer location): North America $ 360,061 $ 386,952 $ 305,618 Europe 161,527 180,888 174,681 Asia 72,268 84,705 109,688 Rest of World 41,172 52,099 43,799 $ 635,028 $ 704,644 $ 633,786 See Note 12 , Business Segment and Geographical Information, for information on the disaggregation of revenue by reportable operating segment. The following table presents contract balances from contracts with customers: (In thousands) January 2, 2021 December 28, 2019 Accounts Receivable $ 91,540 $ 95,740 Contract Assets $ 7,576 $ 13,162 Contract Liabilities $ 39,269 $ 37,216 Contract assets represent unbilled revenue associated with revenue recognized on contracts accounted for on an over time basis, which will be billed in future periods based on the contract terms. Contract liabilities consist of customer deposits, advanced billings, and deferred revenue. Deferred revenue is included in other current liabilities in the accompanying consolidated balance sheet. Contract liabilities will be recognized as revenue in future periods once the revenue recognition criteria are met. The majority of the contract liabilities relate to advance payments on contracts accounted for at a point in time. These advance payments will be recognized as revenue when the Company's performance obligations have been satisfied, which typically occurs when the product has shipped and control of the asset has transferred to the customer. The Company recognized revenue of $30,426,000 in 2020 and $29,220,000 in 2019 that was included in the contract liabilities balance at the beginning of 2020 and 2019. The majority of the Company's contracts for capital equipment have an original expected duration of one year or less. Certain capital contracts require long lead times and could take up to 24 months to complete. For contracts with an original expected duration of over one year, the aggregate amount of the transaction price allocated to the remaining unsatisfied or partially unsatisfied performance obligations as of year-end 2020 was $14,916,000. The Company will recognize revenue for these performance obligations as they are satisfied, approximately 50% of which is expected to occur within the next twelve months and the remaining 50% within twenty-four months. Customers in China will often settle their accounts receivable with banker's acceptance drafts, in which case cash settlement will be delayed until the drafts mature or are settled prior to maturity. For customers outside of China, final payment for the majority of the Company's products is received in the quarter following the product shipment. Certain of the Company's contracts include a longer period before final payment is due, which is typically within one year of final shipment or transfer of control to the customer. The Company includes in revenue amounts invoiced for shipping and handling with the corresponding costs reflected in cost of revenue. Provisions for discounts, warranties, returns and other adjustments are provided for in the period in which the related sale was recorded. Sales taxes, value-added taxes, and certain excise taxes collected from customers and remitted to governmental authorities are accounted for on a net basis and therefore are excluded from revenue. Accounts Receivable and Allowance for Credit Losses Accounts receivable arise from sales on credit to customers, are recorded at the invoiced amount, and do not bear interest. The Company establishes an allowance for credit losses to reduce accounts receivable to the net amount expected to be collected. The Company exercises judgment in determining its allowance for credit losses, which is based on its historical collection and write-off experience, adjusted for current macroeconomic trends and conditions, credit policies, specific customer collection issues, and accounts receivable aging. The Company performs ongoing credit evaluations of its customers and adjusts credit limits based upon payment history and each customer's current creditworthiness. The Company continuously monitors collections and payments from its customers. Account balances are charged off against the allowance when the Company believes it is probable the receivable will not be recovered. In some instances, the Company utilizes letters of credit to mitigate its credit exposure. The changes in the allowance for credit losses are as follows: (In thousands) January 2, 2021 December 28, 2019 December 29, 2018 Balance at Beginning of Year $ 2,698 $ 2,897 $ 2,879 Provision charged to expense 356 114 355 Accounts written off (266) (263) (165) Currency translation 189 (50) (172) Balance at End of Year $ 2,977 $ 2,698 $ 2,897 Banker's Acceptance Drafts Included in Accounts Receivable The Company's Chinese subsidiaries may receive banker's acceptance drafts from customers as payment for their trade accounts receivable. The drafts are noninterest-bearing obligations of the issuing bank and mature within six months of the origination date. The Company's Chinese subsidiaries may sell the drafts at a discount to a third-party financial institution or transfer the drafts to vendors in settlement of current accounts payable prior to the scheduled maturity date. These drafts, which totaled $9,445,000 at year-end 2020 and $5,230,000 at year-end 2019, are included in accounts receivable in the accompanying consolidated balance sheet until the subsidiary sells the drafts to a bank and receives a discounted amount, transfers the banker's acceptance drafts in settlement of current accounts payable prior to maturity, or obtains cash payment on the scheduled maturity date. Warranty Obligations The Company's contracts covering the sale of its products include warranty provisions that provide assurance to its customers that the products will comply with agreed-upon specifications during a defined period of time. The Company provides for the estimated cost of product warranties at the time of sale based on the historical occurrence rates and repair costs, as well as knowledge of any specific warranty problems that indicate projected warranty costs may vary from historical patterns. The Company negotiates the terms regarding warranty coverage and length of warranty depending on the products and applications. While the Company engages in extensive product quality programs and processes, the Company's warranty obligation is affected by product failure rates, repair costs, service delivery costs incurred in correcting a product failure, and supplier warranties on parts delivered to the Company. Should these factors or actual results differ from the Company's estimates, revisions to the estimated warranty liability would be required. The Company's liability for warranties is included in other current liabilities in the accompanying consolidated balance sheet. The changes in the carrying amount of product warranty obligations are as follows: (In thousands) January 2, 2021 December 28, 2019 Balance at Beginning of Year $ 6,467 $ 5,726 Provision charged to expense 5,555 4,727 Usage (5,439) (4,255) Acquisition — 303 Currency translation 481 (34) Balance at End of Year $ 7,064 $ 6,467 Leases In accordance with Topic 842, the Company determines whether an arrangement is, or contains, a lease at inception. Operating leases that have commenced are included in other assets, other current liabilities and other long-term liabilities in the accompanying consolidated balance sheet. Classification of operating lease liabilities as either current or noncurrent is based on the expected timing of payments due under the Company’s lease obligations. Right-of-use (ROU) assets represent the Company’s right to use an underlying asset for the lease term and lease liabilities represent the Company’s obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities with original contract terms greater than 12 months are recognized based on the present value of the future minimum lease payments over the lease term at the commencement date. Operating leases with an original term of 12 months or less are not recorded in the accompanying consolidated balance sheet. In determining the present value of future lease payments, the Company utilizes either the rate implicit in the lease if that rate is readily determinable or its incremental secured borrowing rate commensurate with the term of the underlying lease. Lease terms may include the effect of options to extend or terminate the lease when it is reasonably certain that the Company will exercise that option. The Company recognizes operating lease expense for lease payments on a straight-line basis over the lease term. Variable lease costs are not included in fixed lease payments and, as a result, are excluded from the measurement of the ROU assets and lease liabilities. The Company expenses all variable lease costs as incurred, which were not material in 2020 and 2019. As a lessee, the Company accounts for the lease and non-lease components of its real estate and equipment leases as a single lease component. For vehicle leases, the Company does not combine lease and non-lease components. See Note 9 , Leases, for additional information about the Company's lease obligations. Income Taxes In accordance with ASC 740, Income Taxes (ASC 740), the Company recognizes deferred income taxes based on the expected future tax consequences of differences between the financial statement basis and the tax basis of assets and liabilities, calculated using enacted tax rates in effect for the year in which these differences are expected to reverse. A tax valuation allowance is established, as needed, to reduce deferred tax assets to the amount expected to be realized. In the period in which it becomes more likely than not that some or all of the deferred tax assets will be realized, the valuation allowance will be adjusted. It is the Company's policy to provide for uncertain tax positions and the related interest and penalties based upon management's assessment of whether a tax benefit is more likely than not to be sustained upon examination by tax authorities. The Company recognizes accrued interest and penalties related to unrecognized tax benefits in the provision for income taxes. At January 2, 2021, the Company believes that it has appropriately accounted for any liability for unrecognized tax benefits. To the extent the Company prevails in matters for which a liability for an unrecognized tax benefit is established, the statute of limitations expires for a tax jurisdiction year, or the Company is required to pay amounts in excess of the liability, its effective tax rate in a given financial statement period may be affected. Earnings per Share Basic earnings per share (EPS) is computed by dividing net income attributable to Kadant by the weighted average number of shares outstanding during the year. Diluted EPS is computed using the treasury stock method assuming the effect of all potentially dilutive securities, including stock options, restricted stock units (RSUs) and employee stock purchase plan shares. Cash, Cash Equivalents, and Restricted Cash At year-end 2020 and year-end 2019, cash equivalents included investments in money market funds and marketable securities, which had maturities of three months or less at the date of purchase. The carrying amounts of cash equivalents approximate their fair values due to the short-term nature of these instruments. Restricted cash serves as collateral for certain banker's acceptance drafts issued to vendors and for bank guarantees associated with providing assurance to customers that the Company will fulfill certain customer obligations entered into in the normal course of business. The majority of the bank guarantees will expire over the next twelve months. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported within the accompanying consolidated balance sheet that are shown in aggregate in the consolidated statement of cash flows: (In thousands) January 2, 2021 December 28, 2019 December 29, 2018 Cash and cash equivalents $ 65,682 $ 66,786 $ 45,830 Restricted cash 958 1,487 287 Total Cash, Cash Equivalents, and Restricted Cash $ 66,640 $ 68,273 $ 46,117 Supplemental Cash Flow Information (In thousands) January 2, 2021 December 28, 2019 December 29, 2018 Cash Paid for Interest $ 6,899 $ 12,344 $ 7,550 Cash Paid for Income Taxes, Net of Refunds $ 17,506 $ 24,533 $ 25,654 Non-Cash Investing Activities: Fair value of assets acquired $ 9,295 $ 207,223 $ — Cash paid for acquired businesses (7,565) (179,693) — Liabilities Assumed of Acquired Businesses $ 1,730 $ 27,530 $ — (In thousands) January 2, 2021 December 28, 2019 December 29, 2018 Non-cash additions to property, plant, and equipment $ 1,060 $ 626 $ 917 Non-Cash Financing Activities: Issuance of Company common stock upon vesting of RSUs $ 4,781 $ 4,100 $ 4,231 Dividends declared but unpaid $ 2,770 $ 2,628 $ 2,444 Inventories Inventories are stated at the lower of cost (on a first-in, first-out; or weighted average basis) or net realizable value and include materials, labor, and manufacturing overhead. The Company regularly reviews its quantities of inventories on hand and compares these amounts to the historical and forecasted usage of and demand for each particular product or product line. The Company records a charge to cost of revenue for excess and obsolete inventory to reduce the carrying value of inventories to net realizable value. The components of inventories are as follows: (In thousands) January 2, 2021 December 28, 2019 Raw Materials $ 46,413 $ 49,332 Work in Process 17,692 15,344 Finished Goods (includes $427 and $559 at customer locations) 42,709 38,039 $ 106,814 $ 102,715 Property, Plant, and Equipment Property, plant, and equipment are stated at cost. The costs of additions and improvements are capitalized, while maintenance and repairs are charged to expense as incurred. The Company provides for depreciation and amortization primarily using the straight-line method over the estimated useful lives of the property as follows: buildings, 10 to 40 years; machinery and equipment, 2 to 10 years; and leasehold improvements, the shorter of the term of the lease or the life of the asset. For construction in progress, no provision for depreciation is made until the assets are available and ready for use. Property, plant, and equipment consist of the following: (In thousands) January 2, 2021 December 28, 2019 Land $ 7,676 $ 7,347 Buildings 60,702 58,509 Machinery, Equipment, and Leasehold Improvements 120,804 112,655 Construction in Progress 3,292 2,830 192,474 181,341 Less: Accumulated Depreciation and Amortization 107,832 95,309 $ 84,642 $ 86,032 Depreciation and amortization expense was $12,209,000 in 2020, $12,236,000 in 2019, and $9,386,000 in 2018. See Note 9 , Leases, for further details relating to assets under financing leases included in property, plant and equipment in the accompanying consolidated balance sheet. Intangible Assets, Net Acquired intangible assets by major asset class are as follows: (In thousands) Gross Accumulated Currency Net January 2, 2021 Definite-Lived Customer relationships $ 173,728 $ (65,488) $ (1,316) $ 106,924 Product technology 56,111 (31,655) (1,005) 23,451 Tradenames 6,027 (2,946) (282) 2,799 Other 18,248 (14,369) (515) 3,364 254,114 (114,458) (3,118) 136,538 Indefinite-Lived Tradenames 24,100 — 327 24,427 Acquired Intangible Assets $ 278,214 $ (114,458) $ (2,791) $ 160,965 December 28, 2019 Definite-Lived Customer relationships $ 171,583 $ (51,798) $ (4,141) $ 115,644 Product technology 56,011 (27,819) (1,709) 26,483 Tradenames 6,527 (2,421) (427) 3,679 Other 17,964 (13,295) (593) 4,076 252,085 (95,333) (6,870) 149,882 Indefinite-Lived Tradenames 24,100 — (86) 24,014 Acquired Intangible Assets $ 276,185 $ (95,333) $ (6,956) $ 173,896 Gross intangible assets include $3,907,000 for acquired intangible assets from acquisitions that occurred in 2020. See Note 2 , Acquisitions, for further details. In connection with its impairment analysis, the Company reduced its definite-lived intangible assets by $1,861,000 in 2020 and definite and indefinite-lived intangible assets by $2,336,000 in 2019. Additionally, the Company reclassified $1,300,000 of an indefinite-lived tradename to definite-lived in 2019. See Impairment of Long-Lived Assets under the heading Intangible Assets within this note for further details. Intangible assets are initially recorded at fair value at the date of acquisition. Subsequent impairment charges are reflected as a reduction in the gross balance, as applicable. Definite-lived intangible assets are stated net of accumulated amortization and currency translation in the accompanying consolidated balance sheet. The Company amortizes definite-lived intangible assets over lives that have been determined based on the anticipated cash flow benefits of the intangible asset. Definite-lived intangible assets have a weighted average amortization period of 12 years. Amortization of definite-lived intangible assets was $19,125,000 in 2020, $20,154,000 in 2019, and $14,182,000 in 2018. The estimated future amortization expense of definite-lived intangible assets is $18,365,000 in 2021; $17,398,000 in 2022; $15,849,000 in 2023; $14,839,000 in 2024; $12,729,000 in 2025; and $57,358,000 in the aggregate thereafter. Goodwill Goodwill represents the excess of the cost of an acquisition over the fair value of the identifiable net assets of the acquired business at the date of acquisition. The Company’s acquisitions have historically been made at prices above the fair value of the acquired net assets, resulting in goodwill, due to the expectation of synergies from combining the businesses. The changes in the carrying amount of goodwill by segment are as follows: (In thousands) Flow Control Industrial Processing Material Handling Total Balance as of December 29, 2018 (a) Gross balance $ 98,261 $ 206,664 $ 38,758 $ 343,683 Accumulated impairment losses — (85,509) — (85,509) Net balance 98,261 121,155 38,758 258,174 2019 Adjustments Acquisitions (Note 2) — — 78,592 78,592 Currency translation (581) 872 (1,025) (734) Total 2019 adjustments (581) 872 77,567 77,858 Balance at December 28, 2019 (a) Gross balance 97,680 207,536 116,325 421,541 Accumulated impairment losses — (85,509) — (85,509) Net balance 97,680 122,027 116,325 336,032 2020 Adjustments Acquisition (Note 2) — 3,953 — 3,953 Currency translation 3,757 4,392 3,619 11,768 Total 2020 adjustments 3,757 8,345 3,619 15,721 Balance at January 2, 2021 Gross balance 101,437 215,881 119,944 437,262 Accumulated impairment losses — (85,509) — (85,509) Net balance $ 101,437 $ 130,372 $ 119,944 $ 351,753 (a) Goodwill amounts for 2019 and 2018 have been recast to conform to the current period presentation. See Note 12 , Business Segment and Geographical Information, for further details regarding the Company's change in reportable operating segments. Impairment of Long-Lived Assets The Company evaluates the recoverability of goodwill and indefinite-lived intangible assets as of the end of each fiscal year, or more frequently if events or changes in circumstances indicate that it is more likely than not that the carrying value of an asset might be impaired. Potential impairment indicators include a significant decline in sales, earnings, or cash flows, material adverse changes in the business climate, and a significant decline in the market capitalization due to a sustained decrease in the Company's stock price. The Company assesses its long-lived assets other than goodwill and indefinite-lived intangible assets (definite-lived intangible assets) for impairment whenever facts and circumstances indicate that the carrying amounts may not be fully recoverable. To analyze recoverability, the Company projects undiscounted net future cash flows over the remaining lives of such assets or asset groups. If these projected cash flows were to be less than the carrying amounts, an impairment loss would be recognized, resulting in a write-down of the assets with a corresponding charge to earnings. The impairment loss would be measured based upon the difference between the carrying amounts of the assets and their fair values calculated using projected discounted cash flows. Goodwill In March 2020, the Company experienced a significant decrease in market capitalization due to a decline in the Company’s stock price. During that time, the overall U.S. stock market also declined significantly amid market volatility driven by the uncertainty surrounding the COVID-19 pandemic. Based on these occurrences, the Company concluded that a triggering event had occurred related to the indefinite-lived assets within its material handling reporting unit. As a result, for each reporting period in 2020, the Company prepared a quantitative impairment analysis (Step 1) for its material handling reporting unit, which indicated that its fair value exceeded its carrying value and the indefinite-lived assets were not impaired. At year-end 2020, in connection with its annual impairment analysis, the Company performed a qualitative goodwill impairment assessment (Step 0) for all its reporting units, except the material handling reporting unit, which indicated that the fair value of each reporting unit exceeded its carrying value, and determined that the assets were not impaired. The impairment analysis included an assessment of certain qualitative factors including, but not limited to, the results of prior fair value calculations, the movement of the Company's share price and market capitalization, the reporting unit and overall financial performance, and macroeconomic and industry conditions. The Company considered the qualitative factors and weighed the evidence obtained and determined that it was not more likely than not that the fair value of any of the assets was less than its carrying amount. Although the Company believes the factors considered in the impairment analysis are reasonable, significant changes in any one of the assumptions used could have produced a different result. For its material handling reporting unit, the Company performed a quantitative goodwill impairment assessment (Step 1), which indicated that its fair value exceeded its carrying value for this reporting unit and determined that the asset was not impaired. At year-end 2019, in connection with its annual impairment analysis, the Company performed a qualitative goodwill impairment assessment (Step 0) for all its reporting units and determined that the assets were not impaired. Goodwill by reporting unit is as follows: (In thousands) January 2, 2021 December 28, 2019 Stock-Preparation (a) $ 19,685 $ 19,399 Fluid-Handling 65,755 63,382 Doctoring, Cleaning, & Filtration 35,682 34,297 Wood Processing 110,687 102,629 Material Handling (a) 119,944 116,325 $ 351,753 $ 336,032 (a) Goodwill balances as of December 28, 2019 have been recast to conform to the current period presentation. See Note 12 , Business Segment and Geographical Information, for further details regarding the Company's change in reportable operating segments. Intangible Assets At year-end 2020 and 2019, the Company performed a qualitative impairment analysis on its indefinite-lived intangible assets and determined that the assets were not impaired, except in 2019 related to the indefinite-lived tradename associated with its timber-harvesting product line discussed below. No triggering events or indicators of impairment were identified in 2020 or 2019 related to the Company's definite-lived intangible assets, except for the definite-lived intangible assets associated with its timber-harvesting product line discussed below. During 2019, the Company experienced a significant decrease in revenue and operating results in its timber-harvesting product line included in its Industrial Processing segment, which it acquired in 2017 as part of the acquisition of the forest products business of NII FPG Company (NII FPG). The decrease was primarily driven by the deterioration of several market conditions in the Pacific Northwest, including a widespread timber shortage in this region and high stumpage fees. These factors, along with a shift in demand for timber to the Southeastern part of the United States, resulted in sawmill closures in western Canada where the Company's steep terrain equipment is generally used. Given the decline in demand for this business' products, which was expected to continue into 2020, the Company performed a quantitative analysis of the recoverability of the related intangible assets. As a result of this analysis in which the income approach discounted cash flow methodology was used, the Company determined that the fair values of certain of the timber-harvesting product line's intangible |
