Goodwill and Other Intangible Assets

3 Months Ended

May 30, 2020

Goodwill and Other Intangible Assets

10. Goodwill and Other Intangible Assets

There was no goodwill impairment charge for the thirteen week period ended May 30, 2020. At May 30, 2020 and February 29, 2020, accumulated impairment losses for the Pharmacy Services segment was $574,712.

The Company’s intangible assets are primarily finite-lived and amortized over their useful lives. Following is a summary of the Company’s finite-lived and indefinite-lived intangible assets as of May 30, 2020 and February 29, 2020.


	May 30,2020								February 29, 2020
							Remaining								Remaining
							Weighted								Weighted
	Gross						Average		Gross						Average
	Carrying		Accumulated				Amortization		Carrying		Accumulated				Amortization
	Amount		Amortization		Net		Period		Amount		Amortization		Net		Period
Non-compete agreements and other(a)	$	189,073	$	(165,712)	$	23,361	3	years	$	186,183	$	(163,575)	$	22,608	3	years
Prescription files		957,073		(875,955)		81,118	3	years		950,887		(867,430)		83,457	3	years
Customer relationships(a)		388,000		(239,848)		148,152	11	years		388,000		(231,015)		156,985	12	years
CMS license		57,500		(11,346)		46,154	20	years		57,500		(10,772)		46,728	21	years
Claims adjudication and other developed software		58,985		(41,566)		17,419	2	years		58,985		(39,459)		19,526	3	years
Trademarks		—		—		—	0	years		20,100		(9,413)		10,687	6	years
Backlog		11,500		(11,500)		—	0	years		11,500		(11,500)		—	0	years
Total finite	$	1,662,131	$	(1,345,927)		316,204			$	1,673,155	$	(1,333,164)	$	339,991
Trademarks		—		—		—	Indefinite			19,500		—		19,500	Indefinite
Total	$	1,662,131	$	(1,345,927)	$	316,204			$	1,692,655	$	(1,333,164)	$	359,491

(a)	Amortized on an accelerated basis which is determined based on the remaining useful economic lives of the customer relationships that are expected to contribute directly or indirectly to future cash flows.

In connection with the RxEvolution initiatives previously announced on March 16, 2020, the Company is in process of rebranding its EnvisionRxOptions and MedTrak subsidiaries to its new brand name, Elixir. These trademarks qualify as Level 3 within the fair value hierarchy. Upon the implementation of the rebranding initiatives during the first quarter of fiscal 2021, the Company has determined that the carrying value exceeded the fair value and consequently the Company incurred an impairment charge of $29,852 for these trademarks, which is included within intangible asset impairment charges within the condensed consolidated statement of operations.

Amortization expense for these intangible assets and liabilities was $24,420 and $27,660 for the thirteen week periods ended May 30, 2020 and June 1, 2019, respectively. The anticipated annual amortization expense for these intangible assets and liabilities is 2021—$84,368; 2022—$63,491; 2023—$48,303; 2024—$34,663 and 2025—$23,402.