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Note 4 - Goodwill and Acquired Intangible Assets

12 Months Ended

Dec. 31, 2012

Goodwill and Intangible Assets Disclosure [Text Block]

4. GOODWILL AND INTANGIBLE ASSETS

Goodwill

Our recorded goodwill by reporting segment was as follows at December 31 (in millions):

	2012		2011
Energy and Mining	$	78.1	$	77.4
North American Water and Wastewater		101.9		101.8
European Water and Wastewater		22.3		21.8
Asia-Pacific Water and Wastewater		5.8		5.7
Commercial and Structural		65.6		43.2
Total goodwill	$	273.7	$	249.9

The following table presents a reconciliation of the beginning and ending balances of the Company’s goodwill at December 31 (in millions):

	E&M		NAR		Europe		Asia		C&S		Total
Beginning balance at January 1, 2012	$	77.4	$	101.8	$	21.8	$	5.7	$	43.2	$	249.9
Additions to goodwill through acquisitions(1)		0.1		–		–		–		22.0		22.1
Foreign currency translation		0.6		0.1		0.5		0.1		0.4		1.7
Goodwill at end of period(2)	$	78.1	$	101.9	$	22.3	$	5.8	$	65.6	$	273.7

(1)

During 2012, the Company initially recorded goodwill of $1.7 million and $19.3 million related to the acquisitions of Fyfe LA and Fyfe Asia, respectively. Additionally, the Company recorded decreases of $1.5 million and $0.2 million in goodwill related to the 2011 acquisitions of Hockway and Fyfe NA, respectively, and increases of $1.6 million, $0.7 million and $0.5 million in goodwill related to the CRTS, Fyfe LA and Fyfe Asia acquisitions, respectively.

(2)

The Company does not have any accumulated impairment charges.

Amortized intangible assets were as follows (in thousands):

	As of December 31, 2012(1)									As of December 31, 2011(2)
	Weighted Average Useful Lives (Years)		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
License agreements		7.3	$	3,925	$	(2,821	)	$	1,104	$	3,922	$	(2,654	)	$	1,268
Backlog		—		5,196		(5,196	)		—		5,191		(4,245	)		946
Leases		13.7		2,067		(331	)		1,736		2,067		(183	)		1,884
Trademarks		17.2		21,810		(3,417	)		18,393		21,716		(2,187	)		19,529
Non-competes		—		740		(740	)		—		740		(729	)		11
Customer relationships		14.7		126,301		(19,684	)		106,617		111,723		(12,638	)		99,085
Patents and acquired technology		18.1		55,672		(21,244	)		34,428		53,906		(19,608	)		34,298
			$	215,711	$	(53,433	)	$	162,278	$	199,265	$	(42,244	)	$	157,021

(1)

During 2012, the Company recorded $1.4 million in patents and acquired technology to be amortized over a weighted average life of twenty years and $14.4 million in customer relationships to be amortized over a weighted average life of fifteen years related to the acquisitions discussed in Note 1 of this report.

(2)

During 2011, the Company recorded (i) $1.6 million in backlog to be amortized over the weighted average life of one year, (ii) $6.4 million in trademarks and trade names to be amortized over a weighted average life of 20 years, (iii) $0.8 million in leases to be amortized over a weighted average life of ten years, (iv) $49.7 million in customer relationships to be amortized over a weighted average life of 18 years and (v) $23.7 million in patents and acquired technology to be amortized over a weighted average life of 19 years related to the 2011 acquisitions discussed in Note 1.

Amortization expense was $10.7 million, $7.1 million and $6.4 million for the years ended December 31, 2012, 2011 and 2010, respectively. Estimated amortization expense for each of the next five years is as follows (in thousands):

Year	Amount
2013	$	10,696
2014		10,696
2015		10,696
2016		10,677
2017		10,656

- 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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