Goodwill and Other Intangible Assets

9 Months Ended

Sep. 30, 2013

Goodwill and Other Intangible Assets

Note 13—Goodwill and Other Intangible Assets

The changes in the carrying amount of goodwill for the nine months ended September 30, 2013 were as follows:

	Construction		Transportation			Brake &		Interconnect			FoodService		Disc.
(in millions)	Materials		Products			Friction		Technologies			Products		Ops			Total
Gross balance at January 1, 2013	$	127.2	$	155.5		$	226.7	$	444.6		$	60.3	$	47.4		$	1,061.7
Currency translation	1.0		—			—		(0.2		)	—		—			0.8
Gross balance at September 30, 2013	128.2		155.5			226.7		444.4			60.3		47.4			1,062.5
Accumulated impairment losses	—		(155.5		)	—		—			—		(47.4		)	(202.9		)
Net balance at September 30, 2013	$	128.2	$	—		$	226.7	$	444.4		$	60.3	$	—		$	859.6

Goodwill Impairment

During the three months ended June 30, 2013, the Company’s Transportation Products reporting unit recognized a goodwill impairment loss of $100.0 million due to a decline in the reporting unit’s estimated fair value relative to its carrying value. Fair value was based on an income approach utilizing the discounted cash flow method. The decline in the reporting unit’s estimated fair value was primarily driven by a rise in the underlying interest rates used to determine the discount rate utilized in the discounted cash flow method. This rise in interest rates occurred substantially in the final month of the second quarter of 2013. Given the timing of events leading to the impairment, as of June 30, 2013, the impairment loss was estimated. ASC 350, Intangibles — Goodwill and Other requires that goodwill impairment be based on the implied value of a reporting unit’s goodwill based on the residual method in the same manner as goodwill is recognized in a business combination under ASC 805, Business Combinations. Under the residual method, the implied fair value of the reporting unit’s goodwill is equal to the difference between the reporting unit’s fair value and the fair value of the reporting unit’s assets and liabilities, both recognized and unrecognized. During the three months ended September 30, 2013, management completed the process of determining the fair value of CTP’s assets and liabilities, including identifiable intangible assets that are not currently recognized, nor will be recognized, in CTP’s carrying value. Finalization of the impairment analysis did not result in any adjustments to the initial estimate of impairment loss.

The Company’s Other intangible assets, net at September 30, 2013, were as follows:

	Acquired		Accumulated			Net Book
(in millions)	Cost		Amortization			Value

Assets subject to amortization:
Patents	$	134.0	$	(26.9	)	$	107.1
Customer Relationships	442.3		(88.8		)	353.5
Other	20.6		(11.2		)	9.4
Assets not subject to amortization:
Trade names	120.4		—			120.4
Other intangible assets, net	$	717.3	$	(126.9	)	$	590.4

The Company’s Other intangible assets, net at December 31, 2012, were as follows:

	Acquired		Accumulated			Net Book
(in millions)	Cost		Amortization			Value

Assets subject to amortization:
Patents	$	133.2	$	(20.0	)	$	113.2
Customer Relationships	441.4		(68.3		)	373.1
Other	20.9		(9.7		)	11.2
Assets not subject to amortization:
Trade names	120.0		—			120.0
Other intangible assets, net	$	715.5	$	(98.0	)	$	617.5

Estimated amortization expense for the remainder of 2013 and the next four years is as follows: $9.2 million remaining in 2013, $37.2 million in 2014, $36.6 million in 2015, $35.6 million in 2016, and $35.4 million in 2017.

The net carrying values of the Company’s Other intangible assets by reportable segment were as follows:

	September 30,		December 31,
(in millions)	2013		2012

Carlisle Construction Materials	$	87.1	$	89.7
Carlisle Interconnect Technologies	336.1		353.4
Carlisle Brake & Friction	131.7		136.8
Carlisle FoodService Products	32.8		34.9
Carlisle Transportation Products	2.7		2.7
Total	$	590.4	$	617.5

- 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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