GOODWILL AND OTHER INTANGIBLE ASSETS, NET

Assessment for Impairments

The Company tests goodwill and indefinite-lived intangible assets for impairment at least annually as of May 1, or more frequently, if certain events or circumstances warrant. There were no impairments of goodwill at the Company’s reporting units in fiscal 2018.

In the course of evaluating the results for the second quarter of fiscal 2019, the Company noted the cash flows associated with its Consumer Beauty reporting unit were adversely impacted by negative category trends and market share losses in the color cosmetics, hair color and mass fragrance categories mainly impacting the CoverGirl, Rimmel, Max Factor, Bourjois and Clairol trademarks; additional shelf-spaces losses for CoverGirl, Clairol, and Max Factor; expected increased costs in the short-term to offset the lower service levels caused by supply chain disruptions; and lower than expected net revenues and profitability for Younique. Additionally, the Company considered the impact of a 75 basis point increase in the discount rate, which adversely affected the fair value of the reporting unit. Management concluded that these adverse factors represented indicators of impairment that warranted an interim impairment test for goodwill and certain other intangible assets in the Consumer Beauty reporting unit. As a result, in the three and six months ended December 31, 2018, the Company recognized asset impairment charges of $930.3, of which $832.5 related to goodwill, $90.8 related to indefinite-lived other intangible assets (mainly related to the CoverGirl and Clairol trademarks) and $7.0 related to finite-lived other intangible assets, as described below and recorded in Asset impairment charges in the Condensed Consolidated Statements of Operations.

Additionally, the Company identified indicators of impairment related to the philosophy trademark that is part of the Luxury reporting unit and recorded an asset impairment charge of $22.8 for the three and six months ended December 31, 2018. In addition to the impact of a 75 basis point increase in the discount rate for the trademark, the Company considered the impact of the business indicators of lower than expected net revenue growth in the U.S. and a decrease in the level of expected profitability of the trademark.

Goodwill

Goodwill as of December 31, 2018 and June 30, 2018 is presented below:



	Luxury			Consumer Beauty			Professional Beauty			Total
Gross balance at June 30, 2018	$	3,366.6		$	4,927.5		$	953.8		$	9,247.9
Accumulated impairments	(403.7		)	(237.1		)	—			(640.8		)
Net balance at June 30, 2018	$	2,962.9		$	4,690.4		$	953.8		$	8,607.1

Changes during the period ended December 31, 2018:
Measurement period adjustments ^(a)	(10.5		)	0.6			0.5			(9.4		)
Foreign currency translation	(30.2		)	(51.5		)	(18.5		)	(100.2		)
Impairment charges	—			(832.5		)	—			(832.5		)

Gross balance at December 31, 2018	$	3,325.9		$	4,876.6		$	935.8		$	9,138.3
Accumulated impairments	(403.7		)	(1,069.6		)	—			(1,473.3		)
Net balance at December 31, 2018	$	2,922.2		$	3,807.0		$	935.8		$	7,665.0

^(a)Includes measurement period adjustments in connection with the Burberry Beauty Business acquisition (Refer to Note 5—Business Combinations).

Other Intangible Assets, net

Other intangible assets, net as of December 31, 2018 and June 30, 2018 are presented below:



	December 31, 2018		June 30, 2018
Indefinite-lived other intangible assets	$	3,052.0	$	3,186.2
Finite-lived other intangible assets, net	4,877.4		5,098.2
Total Other intangible assets, net	$	7,929.4	$	8,284.4

The changes in the carrying amount of indefinite-lived other intangible assets are presented below:



	Luxury			Consumer Beauty			Professional Beauty			Total
Gross balance at June 30, 2018	$	414.6		$	1,703.1		$	1,266.3		$	3,384.0
Accumulated impairments	(118.8		)	(75.9		)	(3.1		)	(197.8		)
Net balance at June 30, 2018	295.8			1,627.2			1,263.2			3,186.2

Changes during the period ended December 31, 2018:
Foreign currency translation	(5.8		)	(7.1		)	(7.7		)	(20.6		)
Impairment charges	(22.8		)	(90.8		)	—			(113.6		)

Gross balance at December 31, 2018	408.8			1,696.0			1,258.6			3,363.4
Accumulated impairments	(141.6		)	(166.7		)	(3.1		)	(311.4		)
Net balance at December 31, 2018	$	267.2		$	1,529.3		$	1,255.5		$	3,052.0

Intangible assets subject to amortization are presented below:



	Cost		Accumulated Amortization			Accumulated Impairment			Net
June 30, 2018
License agreements	$	3,362.7	$	(792.9	)	$	—		$	2,569.8
Customer relationships	1,960.5		(508.7		)	(5.5		)	1,446.3
Trademarks	1,002.1		(185.5		)	(0.4		)	816.2
Product formulations and technology	361.2		(95.3		)	—			265.9
Total	$	6,686.5	$	(1,582.4	)	$	(5.9	)	$	5,098.2
December 31, 2018
License agreements ^(a)	$	3,259.9	$	(810.7	)	$	(19.6	)	$	2,429.6
Customer relationships ^(a)	1,949.7		(572.0		)	(5.5		)	1,372.2
Trademarks^(b)	1,040.2		(207.1		)	(0.4		)	832.7
Product formulations and technology	353.9		(111.0		)	—			242.9
Total	$	6,603.7	$	(1,700.8	)	$	(25.5	)	$	4,877.4

^(a)Includes measurement period adjustments during the six months ended December 31, 2018 in connection with the Burberry Beauty Business acquisition (Refer to Note 5—Business Combinations).

^(b)Includes an acquired trademark of $40.8.

In July 2018, the Company acquired a trademark associated with a preexisting license. As a result of the acquisition, the preexisting license was effectively terminated, and accordingly the Company recorded $12.6 of Asset impairment charges in the Condensed Consolidated Statement of Operations related to the license agreement.

Amortization expense was $88.5 and $89.6 for the three months ended December 31, 2018 and 2017, respectively and $181.0 and $167.8 for the six months ended December 31, 2018 and 2017, respectively.