Goodwill & Intangible Assets

12 Months Ended

Dec. 31, 2012

Goodwill & Intangible Assets [Abstract]

4. GOODWILL & INTANGIBLE ASSETS

The following table summarizes the goodwill and identifiable intangible assets as of December 31, 2012 and 2011:


	December 31, 2012								December 31, 2011
($ thousands)	Gross Carrying Amount			Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount			Accumulated Amortization			Net Carrying Amount
Capitalized software	$	87,426	⁽¹⁾	$	(33,933)	⁽²⁾	$	53,493	$	66,530	⁽¹⁾	$	(22,156)	⁽²⁾	$	44,374
Customer relationships		7,145			(6,222)			923		6,321			(5,641)			680
Patents, copyrights, and trademarks		6,161			(3,522)			2,639		6,109			(2,994)			3,115
Core technology		4,856			(4,856)			-		4,743			(4,743)			-
Other		670			(636)			34		997			(636)			361
Total finite lived intangible assets		106,258			(49,169)			57,089		84,700			(36,170)			48,530
Indefinite lived intangible assets		113			-			113		111			-			111
Goodwill ⁽³⁾		2,729			-			2,729		-			-			-
Intangible assets	$	109,100		$	(49,169)		$	59,931	$	84,811		$	(36,170)		$	48,641

⁽¹⁾ Includes $4.1 million of software held under a capital lease classified as capitalized software as of December 31, 2012 and 2011.

⁽²⁾ Includes $1.3 million and $0.7 million of accumulated amortization of software held under a capital lease as of December 31, 2012 and 2011, respectively, which is amortized using the straight-line method over the useful life.

⁽³⁾ On July 16, 2012, our subsidiaries Crocs Europe B.V., Crocs Stores B.V. and Crocs Belgium N.V. (collectively referred to as Crocs Europe), which are part of our Europe segment, acquired certain net assets and activities from Crocs Benelux B.V. (Benelux) pursuant to a sale and purchase agreement dated July 9, 2012. Prior to the acquisition, Benelux was a distributor of the Company. The Company acquired Benelux’ retail business and wholesale business, including inventory, fixed assets, customer relationships, 10 retail stores and their associated leases. Total consideration paid was cash of € 3.6 million (approximately $4.6 million).

During the years ended December 31, 2012, 2011 and 2010, amortization expense recorded for intangible assets with finite lives was $13.6 million, $9.8 million and $7.6 million, respectively, of which $4.3 million, $2.9 million and $2.3 million was recorded in cost of sales, respectively. The remaining amounts were recorded in selling, general and administrative expenses.

The following table summarizes estimated future annual amortization of intangible assets as of December 31, 2012:


	Amortization
Fiscal years ending December 31,	($ thousands)
2013	$	14,956
2014		13,139
2015		10,003
2016		8,531
2017		5,689
Thereafter		4,771
Total	$	57,089

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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