2.	Broadcast Licenses, Goodwill and Other Intangible Assets

We evaluate our FCC licenses for impairment annually, or more frequently if events or changes in circumstances indicate that the asset might be impaired. We operate our broadcast licenses in each market as a single asset and determine the fair value by relying on a discounted cash flow approach assuming a start-up scenario in which the only assets held by an investor are broadcast licenses. The fair value calculation contains assumptions incorporating variables that are based on past experiences and judgments about future operating performance using industry normalized information for an average station within a market. These variables include, but are not limited to: (1) the forecasted growth rate of each radio or television market, including population, household income, retail sales and other expenditures that would influence advertising expenditures; (2) the estimated available advertising revenue within the market and the related market share and profit margin of an average station within a market; (3) estimated capital start-up costs and losses incurred during the early years; (4) risk-adjusted discount rate; (5) the likely media competition within the market area; and (6) terminal values. If the carrying amount of FCC licenses is greater than their estimated fair value in a given market, the carrying amount of FCC licenses in that market is reduced to its estimated fair value.

We also evaluate goodwill in each of its reporting units (reportable segment) for impairment annually, or more frequently if certain circumstances are present. If the carrying amount of goodwill in a reporting unit is greater than the implied value of goodwill determined by completing a hypothetical purchase price allocation using estimated fair value of the reporting unit, the carrying amount of goodwill in that reporting unit is reduced to its implied value.

We utilize independent appraisals in testing FCC licenses for impairment when indicators of impairment are present.

We evaluate amortizable intangible assets for recoverability when circumstances indicate impairment may have occurred, using an undiscounted cash flow methodology. If the future undiscounted cash flows for the intangible asset are less than net book value, then the net book value is reduced to the estimated fair value. Amortizable intangible assets are included in other intangibles, deferred costs and investments in the consolidated balance sheets.

Broadcast Licenses

We have recorded the changes to broadcast licenses for the years ended December 31, 2017 and 2016 as follows:

	Continuing Operations		Discontinued Operations		Total
	(In thousands)

Balance at January 1, 2016	$	78,499	$	9,607	$	88,106
Acquisitions		8,123		—		8,123
Balance at December 31, 2016	$	86,622	$	9,607	$	96,229
Acquisitions		8,086		—		8,086
Dispositions		—		(9,607)		(9,607)
Impairment charge		(1,449)		—		(1,449)
Balance at December 31, 2017	$	93,259	$	—	$	93,259

2017 Impairment Test

We completed our annual impairment test of broadcast licenses during the fourth quarter of 2017 and determined that the fair value of the broadcast licenses were less than the amount reflected in the balance sheet for one of the Company’s radio markets, Springfield, Illinois, and recorded non-cash impairment charge of $1,449,000 to reduce the carrying value of these assets to the estimated fair market value. The reasons for the impairment to the broadcasting licenses recognized in the fourth quarter of 2017 were primarily due to declines in available market revenue, market revenue share, profit margins and estimated long-term growth rates in our Springfield, Illinois market.

The following table reflects certain key estimates and assumptions used in the impairment test in the fourth quarter of 2017. The ranges for operating profit margin and market long-term revenue growth rates vary by market. In general, when comparing between 2017, 2016 and 2015: (1) the market specific operating profit margin range remained relatively consistent; (2) the market long-term revenue growth rates were relatively consistent; (3) the discount rate remained relatively consistent; and (4) current year revenues were 0.8 % lower than previously projected for 2017.

	Fourth Quarter 2017		Fourth Quarter 2016		Fourth Quarter 2015
Discount rates	12.4% - 12.5	%	12.3% - 12.4	%	12.2% - 12.4	%
Operating profit margin ranges	19.0% - 36.4	%	19.5% - 36.4	%	19.5% - 36.4	%
Market long-term revenue growth rates	1.1% - 3.5	%	1.0% - 2.9	%	1.3% - 3.1	%

If actual market conditions are less favorable than those estimated by us or if events occur or circumstances change that would reduce the fair value of our broadcast licenses below the carrying value, we may be required to recognize additional impairment charges in future periods. Such a charge could have a material effect on our consolidated financial statements.

2016 Impairment Test

During the fourth quarter of 2016, we completed our annual impairment test of broadcast licenses and determined that the fair value of the broadcast licenses was greater than the carrying value recorded for each of our markets and, accordingly, no impairment was recorded.

2015 Impairment Test

We completed our annual impairment test of broadcast licenses during the fourth quarter of 2015 and determined that the fair value of the broadcast licenses were less than the amount reflected in the balance sheet for one of the Company’s radio markets, Columbus, Ohio, and recorded non-cash impairment charge of $874,000 to reduce the carrying value of these assets to the estimated fair market value. The reasons for the impairment to the broadcasting licenses recognized in the fourth quarter of 2015 were primarily due to declines in available market revenue, market revenue share, profit margins and estimated long-term growth rates in our Columbus, Ohio market.

Goodwill

During the fourth quarter of 2017, the Company performed its annual impairment test of its goodwill in accordance with ASC 350 and determined under the first step that the fair value of our continuing operations was in excess of its carrying value.

We have recorded the changes to goodwill for each of the years ended December 31, 2017 and 2016 as follows:

	Continuing Operations		Discontinued Operations		Total
	(In thousands)

Balance at January 1, 2016	$	2,874	$	—	$	2,874
Acquisitions		4,533		—		4,533
Balance at December 31, 2016	$	7,407	$	—	$	7,407
Acquisitions		8,151		—		8,151
Balance at December 31, 2017	$	15,558	$	—	$	15,558

Other Intangible Assets

We have recorded amortizable intangible assets at December 31, 2017 as follows:

	Gross
	Carrying		Accumulated		Net
	Amount		Amortization		Amount
	(In thousands)
Non-competition agreements	$	3,861	$	3,861	$	—
Favorable lease agreements		5,965		5,468		497
Customer relationships		3,546		1,529		2,017
Other intangibles		1,834		1,630		204
Total amortizable intangible assets	$	15,206	$	12,488	$	2,718

We have recorded amortizable intangible assets at December 31, 2016 as follows:

	Gross
	Carrying		Accumulated		Net
	Amount		Amortization		Amount
	(In thousands)
Non-competition agreements	$	3,861	$	3,861	$	—
Favorable lease agreements		5,763		5,439		324
Customer relationships		1,744		747		997
Other intangibles		1,920		1,682		238
Total amortizable intangible assets	$	13,288	$	11,729	$	1,559

Aggregate amortization expense for these intangible assets for the years ended December 31, 2017, 2016 and 2015, was $860,000, $642,000 and $231,000, respectively. Our estimated annual amortization expense for the years ending December 31, 2018, 2019, 2020, 2021 and 2022 is $1,094,000, $691,000, $475,000, $49,000 and $39,000, respectively.