NOTE 3. GOODWILL AND OTHER INTANGIBLES RESULTING FROM BUSINESS ACQUISITIONS
Results from our annual impairment test in the fourth quarter of 2013 indicated that no impairment had occurred in 2013 related to goodwill and indefinite-lived intangible assets. The fair value of these assets was primarily based on Level 3 inputs.
Goodwill
Changes in the net carrying amount of goodwill for 2013 and 2012, by reportable segment and other businesses, were as follows:
| (In millions) |
Pressure- sensitive Materials |
Retail Branding and Information solutions |
Other specialty converting businesses |
Total |
|||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
|
Goodwill as of December 31, 2011 |
$ | 336.7 | $ | 419.1 | $ | 3.5 | $ | 759.3 | |||||
|
Foreign currency translation adjustments |
1.6 | 3.5 | – | 5.1 | |||||||||
|
Goodwill as of December 29, 2012 |
338.3 | 422.6 | 3.5 | 764.4 | |||||||||
|
Divestiture (1) |
– | – | (3.5 | ) | (3.5 | ) | |||||||
|
Acquisition adjustments |
– | (.2 | ) | – | (.2 | ) | |||||||
|
Translation adjustments |
(3.9 | ) | (5.7 | ) | – | (9.6 | ) | ||||||
|
Goodwill as of December 28, 2013 |
$ | 334.4 | $ | 416.7 | $ | – | $ | 751.1 | |||||
The carrying amount of goodwill at December 28, 2013 and December 29, 2012 was net of accumulated impairment losses of $820 million, which were reported in the Retail Branding and Information Solutions segment.
Indefinite-Lived Intangible Assets
The carrying value of indefinite-lived intangible assets resulting from business acquisitions, consisting of trademarks, was $10.9 million and $11.1 million at December 28, 2013 and December 29, 2012, respectively.
In conjunction with the preparation of our annual impairment test in the fourth quarter of 2012, we determined that the carrying value of our indefinite-lived intangible assets exceeded its fair value which resulted in a non-cash impairment charge of $7 million, which was recorded in "Other expense, net" in the Consolidated Statements of Income. This charge was included in the Retail Branding and Information Solutions reportable segment. The fair value of these assets was primarily based on Level 3 inputs.
Finite-Lived Intangible Assets
The following table sets forth our finite-lived intangible assets resulting from business acquisitions at December 28, 2013 and December 29, 2012, which continue to be amortized:
| |
2013 | 2012 | |||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| (In millions) |
Gross Carrying Amount |
Accumulated Amortization |
Net Carrying Amount |
Gross Carrying Amount |
Accumulated Amortization |
Net Carrying Amount |
|||||||||||||
|
Customer relationships |
$ | 234.1 | $ | 164.6 | $ | 69.5 | $ | 234.7 | $ | 142.3 | $ | 92.4 | |||||||
|
Patents and other acquired technology |
48.9 | 38.3 | 10.6 | 49.0 | 34.0 | 15.0 | |||||||||||||
|
Trade names and trademarks |
26.2 | 22.5 | 3.7 | 25.7 | 21.9 | 3.8 | |||||||||||||
|
Other intangibles |
12.4 | 11.1 | 1.3 | 12.4 | 9.7 | 2.7 | |||||||||||||
|
Total |
$ | 321.6 | $ | 236.5 | $ | 85.1 | $ | 321.8 | $ | 207.9 | $ | 113.9 | |||||||
The finite-lived intangible assets related to our OCP business were classified in the Consolidated Balance Sheets at year-end 2012 as "Assets held for sale." See Note 2, "Discontinued Operations, Exit/Sale of Product Lines, Sale of Assets and Assets Held for Sale," for more information.
Amortization expense from continuing operations for finite-lived intangible assets resulting from business acquisitions was $28.5 million for 2013, $29.9 million for 2012, and $30.3 million for 2011.
The estimated amortization expense from continuing operations for finite-lived intangible assets resulting from business acquisitions for each of the next five fiscal years is expected to be as follows:
| (In millions) |
Estimated Amortization Expense |
|||
|---|---|---|---|---|
|
2014 |
$ | 24.3 | ||
|
2015 |
20.9 | |||
|
2016 |
19.5 | |||
|
2017 |
10.0 | |||
|
2018 |
2.5 | |||
As of December 28, 2013, the weighted-average amortization periods from the date of acquisition and weighted-average remaining useful lives of finite-lived intangible assets were as follows:
| (In years) |
Weighted-average Amortization Periods from the Date of Acquisition |
Weighted-average Remaining Useful Life | ||
|---|---|---|---|---|
|
Customer relationships |
11 | 3 | ||
|
Patents and other acquired technology |
13 | 3 | ||
|
Trade names and trademarks |
12 | 6 | ||
|
Other intangibles |
6 | 1 | ||