3. LONG-LIVED ASSETS AND LEASED FACILITIES AND EQUIPMENT

Property, plant and equipment

Depreciation expense for 2024 and 2023 was $4.3 million and $4.9 million, respectively.

During the first quarter 2024, we sold certain excess real property (consisting of land and buildings) of our Fabrication Division that was part of our Houma Facilities for cash proceeds of $8.5 million (net of transaction and other costs), resulting in a net gain of $2.9 million during 2024, which is reflected within other income (expense), net on our Statement of Operations. The proceeds received are reflected within proceeds from sale of property and equipment on our Statement of Cash Flows. The property sold was classified as an asset held for sale (“Houma AHFS”) on our Balance Sheet at December 31, 2023, and its carrying value was $5.6 million, which was less than its fair value based on the proceeds from its sale.

Leased Facilities and Equipment

We lease certain office, warehouse and operating facilities under long-term lease arrangements that expire at various dates through January 2030, some of which include renewal options ranging from one to 15 years. At December 31, 2024, our lease asset, current lease liability and long-term lease liability were $0.9 million, $0.5 million and $0.6 million, respectively. Our lease obligations include any renewal options that we intend to exercise. Future minimum payments under leases having initial terms of more than twelve months are as follows (in thousands):

Lease expense for our leased facilities and equipment, which includes lease asset amortization expense and expense for leases with original terms that are twelve months or less, for 2024 and 2023 was $1.3 million and $1.7 million, respectively. Cash paid for leases for 2024 and 2023 was $1.7 million and $2.0 million, respectively. Certain of our leases are subject to subleases with third parties. Sublease income for 2024 and 2023 was $0.6 million and $0.6 million, respectively, and is included in other (income) expense, net on our Statement of Operations.

Goodwill and Other Intangible Assets

Goodwill – As discussed in Note 1, goodwill is not amortized, but instead is reviewed for impairment at least annually at a reporting unit level, absent indicators of impairment or when other actions require an impairment assessment (such as a change in reporting units). We perform our annual impairment assessment during the fourth quarter of each year based on balances as of October 1. At October 1, 2024, our Services Division represented our only reporting unit with goodwill. During 2024, we had no indicators of impairment and had no changes to our reporting unit. We performed a qualitative assessment of our goodwill, and determined that it was not more likely than not that the fair value of our reporting unit was less than its carrying value. Accordingly, a quantitative assessment was not deemed necessary.

Other Intangible Assets – Other intangible assets were derived from the estimated fair value of existing underlying customer relationships associated with a previous acquisition and consisted of the following at December 31, 2024 and 2023 (in thousands):

Our intangible assets have estimated lives of seven years and amortization expense for 2024 and 2023 was $0.1 million and $0.1 million, respectively. Amortization expense is estimated to be approximately $0.1 million for each of 2025, 2026, 2027 and 2028.