Goodwill And Other Intangible Assets

3 Months Ended

Mar. 30, 2013

Goodwill And Other Intangible Assets [Abstract]

GOODWILL AND OTHER INTANGIBLE ASSETS

The changes in the carrying amount of goodwill for the quarter ended March 30, 2013, are as follows:



(in thousands)	Carrying Amount
Balance as of December 29, 2012	$	540,389
Goodwill acquired in the purchase of route businesses	3,603
Goodwill attributable to the sale of route businesses	(1,451		)
Change in goodwill reclassified to assets held for sale	(3,972		)
Change in foreign currency exchange rate	(861		)
Balance as of March 30, 2013	$	537,708

As of March 30, 2013, and December 29, 2012, other intangible assets consisted of the following:



(in thousands)	Gross Carrying Amount		Accumulated Amortization			Net Carrying Amount
As of March 30, 2013:
Customer and contractual relationships – amortized	$	148,956	$	(12,636	)	$	136,320
Non-compete agreement – amortized	100		(22		)	78
Reacquired rights – amortized	3,100		(641		)	2,459
Patents – amortized	8,600		(361		)	8,239
Routes – unamortized	16,792		—			16,792
Trademarks – unamortized	362,587		(526		)	362,061
Balance as of March 30, 2013	$	540,135	$	(14,186	)	$	525,949

As of December 29, 2012:
Customer and contractual relationships – amortized	$	148,956	$	(10,524	)	$	138,432
Non-compete agreement – amortized	100		(10		)	90
Reacquired rights – amortized	3,100		(544		)	2,556
Patents – amortized	8,600		(165		)	8,435
Routes – unamortized	20,161		—			20,161
Trademarks – unamortized	362,587		(526		)	362,061
Balance as of December 29, 2012	$	543,504	$	(11,769	)	$	531,735

Amortization expense related to intangibles was $2.4 million and $1.2 million for the quarters ended March 30, 2013, and March 31, 2012, respectively.

Routes and trademarks are deemed to have indefinite useful lives because they are expected to generate cash flows indefinitely. Although not amortized, they are reviewed for impairment as conditions change or at least on an annual basis. In the fourth quarter of 2012, we incurred $7.6 million in impairment charges on two of our trademarks. This impairment was necessary as we made a decision to replace a portion of the sales of these branded products with other, more recognizable, brands in our portfolio. The majority of our trademarks, including the two partially impaired trademarks, have a fair value which approximates the book value. Any changes in the use of these trademarks or the sales volumes of the associated products could result in an impairment charge. In addition, the valuation of trademarks acquired in the Snack Factory acquisition in the fourth quarter of 2012 assumes significant revenue growth in current and future years. Although we believe this rate of revenue growth is reasonable, any reduction in growth or growth expectations could result in impairment of the associated trademark.

The changes in the carrying amount of routes for the quarter ended March 30, 2013, are as follows:



(in thousands)	Carrying Amount
Balance of routes as of December 29, 2012	$	20,161
Purchases of route businesses, exclusive of goodwill acquired	7,540
Sales of route businesses	(2,967		)
Change in routes reclassified to assets held for sale	(7,942		)
Balance of routes as of March 30, 2013	$	16,792

For the quarters ended March 30, 2013, and March 31, 2012, we recorded net gains of $0.1 million and $9.3 million, respectively, from the sale of route businesses.

Routes and associated goodwill allocated to assets held for sale represent assets available for sale in their present condition and for which actions to complete a sale have been initiated. As of March 30, 2013, $12.9 million of route intangibles and $6.3 million of goodwill are included in assets held for sale in the Condensed Consolidated Balance Sheets. As of December 29, 2012, $4.9 million in route intangibles and $2.3 million of goodwill were included in assets held for sale. The increase in assets held for sale is due to continued optimization and expansion of our IBO distribution network.

- 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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