NUCOR CORP | 2013 | FY | 3


9. Goodwill and Other Intangible Assets

The change in the net carrying amount of goodwill for the years ended December 31, 2013 and 2012 by segment is as follows (in thousands):

 

     Steel
Mills
     Steel
Products
    Raw
Materials
     All
Other
    Total  

Balance, December 31, 2011

   $ 268,466       $ 790,441      $ 682,902       $ 88,852      $ 1,830,661   

Acquisitions and dispositions

     138,579         (3,489     20,323         —          155,413   

Translation

     —           18,464        —           —          18,464   
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

Balance, December 31, 2012

     407,045         805,416        703,225         88,852        2,004,538   

Reclassifications

     88,852         —          —           (88,852     —     

Translation

     —           (26,067     —           —          (26,067

Other

     —           (4,863     —           —          (4,863
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

Balance, December 31, 2013

   $ 495,897       $ 774,486      $ 703,225       $ —        $ 1,973,608   
  

 

 

    

 

 

   

 

 

    

 

 

   

 

 

 

The majority of goodwill is not tax deductible.

Previously, Nucor’s steel trading businesses and rebar distribution businesses were reported in the “All other” category. Beginning in the first quarter of 2013, these businesses were reclassified to the steel mills segment as part of a realignment of Nucor’s reportable segments to better reflect the way in which they are managed (see Note 1).

Intangible assets with estimated lives of 5 to 22 years are amortized on a straight-line or accelerated basis and are comprised of the following (in thousands):

 

     December 31, 2013      December 31, 2012  
     Gross
Amount
     Accumulated
Amortization
     Gross
Amount
     Accumulated
Amortization
 

Customer relationships

   $ 1,147,786       $ 391,254       $ 1,156,979       $ 325,819   

Trademarks and trade names

     151,332         40,397         152,869         32,653   

Other

     21,869         15,182         28,610         20,746   
  

 

 

    

 

 

    

 

 

    

 

 

 
   $ 1,320,987       $ 446,833       $ 1,338,458       $ 379,218   
  

 

 

    

 

 

    

 

 

    

 

 

 

Intangible asset amortization expense was $74.4 million in 2013 ($73.0 million in 2012 and $67.8 million in 2011). Annual amortization expense is estimated to be $70.0 million in 2014; $68.2 million in 2015; $66.5 million in 2016; $64.8 million in 2017; and $61.1 million in 2018.

The Company completed its annual goodwill impairment testing as of the first days of the fourth quarters of 2013, 2012 and 2011 and concluded that as of such dates there was no impairment of goodwill for any of its reporting units. We do not believe there are currently any reporting units at risk of goodwill impairment in the near term. However,

assumptions in estimating reporting unit fair values are subject to a high degree of judgment and complexity. Changes in assumptions and estimates may affect the estimated reporting unit fair values and could result in impairment charges in future periods.


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