GOODWILL AND OTHER INTANGIBLE ASSETS

9 Months Ended

Feb. 24, 2019

Goodwill and Other Intangible Assets [Abstract]

Goodwill and Other Intangible Assets

(4) Goodwill and Other Intangible Assets

The components of goodwill and other intangible assets are as follows:

In Millions		Feb. 24, 2019		May 27, 2018
Goodwill	$	14,025.8	$	14,065.0
Other intangible assets:
Intangible assets not subject to amortization:
Brands and other indefinite-lived intangibles		6,606.5		6,818.7
Intangible assets subject to amortization:
Franchise agreements, customer relationships, and other finite-lived intangibles		792.8		811.7
Less accumulated amortization		(203.6)		(185.3)
Intangible assets subject to amortization, net		589.2		626.4
Other intangible assets		7,195.7		7,445.1
Total	$	21,221.5	$	21,510.1

Based on the carrying value of finite-lived intangible assets as of February 24, 2019, annual amortization expense for each of the next five fiscal years is estimated to be approximately $40 million.

During the fourth quarter of fiscal 2018, we acquired Blue Buffalo, which became our Pet operating segment and we recorded $5.3 billion of goodwill, $2.7 billion related to an indefinite-lived brand intangible asset, and $269.0 million related to a finite-lived customer relationship intangible asset.

The changes in the carrying amount of goodwill during fiscal 2019were as follows:

In Millions		North America Retail		Pet		Convenience Stores & Foodservice		Europe & Australia		Asia & Latin America		Joint Ventures		Total
Balance as of May 27, 2018	$	6,410.6	$	5,294.9	$	918.8	$	729.9	$	285.0	$	425.8	$	14,065.0
Other activity, primarily foreign
currency translation		(1.4)		-		-		(19.1)		(7.1)		(11.6)		(39.2)
Balance as of Feb. 24, 2019	$	6,409.2	$	5,294.9	$	918.8	$	710.8	$	277.9	$	414.2	$	14,025.8

The changes in the carrying amount of other intangible assets during fiscal 2019were as follows:

In Millions		Total
Balance as of May 27, 2018	$	7,445.1
Impairment charges		(192.6)
Other activity, primarily foreign currency translation		(56.8)
Balance as of Feb. 24, 2019	$	7,195.7

We performed our annual goodwill and indefinite-lived intangible assets impairment test as of the first day of the second quarter of fiscal 2019. As a result of lower sales projections in our long-range plans for the businesses supporting theProgresso, Food Should Taste Good, and Mountain High brand intangible assets, we recorded the following impairment charges:

In Millions		Impairment Charge		Fair Value as of Nov. 25, 2018 (a)
Progresso	$	132.1	$	330.0
Food Should Taste Good		45.1		-
Mountain High		15.4		-
Total	$	192.6	$	330.0
(a) Level 3 assets in the fair value hierarchy.

Significant assumptions used in that assessment included our long-range cash flow projections for the businesses, royalty rates, weighted average cost of capital rates, and tax rates.

All other intangible asset fair values were substantially in excess of the carrying values, except for the Latin America reporting unit and theYokibrand intangible asset.The excess fair value as of the fiscal 2019 test date of the Latin America reporting unit and theYoki brand intangible asset were as follows:

In Millions		Carrying Value of Intangible Asset	Excess Fair Value as of Fiscal 2019 Test Date
Latin America	$	209.0	7%
Yoki	$	49.1	10%

While having significant coverage as of our fiscal 2019 assessment date, the Pillsbury brand intangible asset and U.S. Yogurt reporting unit had risk of decreasing coverage. We will continue to monitor thesebusinesses for potential impairment.