Goodwill and Other Intangible Assets

12 Months Ended

Dec. 29, 2012

Goodwill and Intangible Assets Disclosure [Abstract]

Goodwill and Other Intangible Assets [Text Block]

Goodwill and Other Intangible Assets

The changes in the carrying amount of goodwill as of the years ended 2012 and 2011 by reportable segment are as follows (in thousands):



	Print and Envelope			Label and Packaging			Total
Balance as of the year ended 2010	$	78,453		$	114,458		$	192,911
Acquisitions, net	1,328			(2,493		)	(1,165		)
Foreign currency translation	(924		)	—			(924		)
Balance as of the year ended 2011	78,857			111,965			190,822
Acquisitions, net	644			—			644
Foreign currency translation	(51		)	—			(51		)
Balance as of the year ended 2012	$	79,450		$	111,965		$	191,415

During the third quarter of 2010, based on a combination of factors, including the continued economic uncertainty that remained in the United States and global economies and revisions to forecasted operating results, the Company believed that there were sufficient indicators that would require it to perform an interim goodwill and long-lived asset impairment analysis. The Company's valuation of all of its reporting units was performed using the income approach in which the Company utilized a discounted cash flow analysis to determine the present value of expected future cash flows of each reporting unit. The Company performed a market approach analysis in order to support the reasonableness of the fair value determined under the income approach. The Company's 2010 analysis utilized a higher discount rate applied to lower estimated future cash flows compared to its prior year analysis and reflected increased borrowing rates and equity risk premiums implied by then current market conditions. The Company determined that within its print and envelope segment, the fair value was below its carrying amounts including goodwill. The Company performed additional fair value measurement calculations to determine total impairment. As part of its valuation to determine the total impairment charge, the Company also estimated the fair value of significant tangible and intangible long-lived assets within its print and envelope segment. These tangible and intangible long-lived assets were valued using appropriate valuation techniques for assets of their nature, such as the relief-from-royalty and income approaches.

As a result of the goodwill and long-lived asset impairment analysis performed in 2010, the Company recorded non-cash impairment charges of $132.2 million related to goodwill and $49.2 million related to other long-lived assets, of which $22.0 million related to an indefinite lived trade name and $27.2 million related to customer relationships within its print and envelope segment. The Company believes that these charges primarily resulted from reductions in the estimated fair value of this reporting unit due to: (i) higher discount rates applied to lower estimated future cash flows and (ii) continued economic uncertainty, which has increased customer cost awareness resulting in continued price pressures, lower page counts, and a shift from historical web and sheet-fed print products to lower cost digital print products.

Other intangible assets are as follows (in thousands):



		2012										2011
	Weighted Average Remaining Amortization Period (Years)	Gross Carrying Amount		Accumulated Impairment Charges			Accumulated Amortization			Net Carrying Amount		Gross Carrying Amount		Accumulated Impairment Charges			Accumulated Amortization			Net Carrying Amount
Intangible assets with definite lives:
Customer relationships	10	$	166,600	$	(27,234	)	$	(63,772	)	$	75,594	$	166,652	$	(27,234	)	$	(54,911	)	$	84,507
Trademarks and trade names	23	23,471		—			(6,590		)	16,881		23,481		—			(5,620		)	17,861
Patents	9	3,528		—			(2,839		)	689		3,528		—			(2,583		)	945
Non-compete agreements		510		—			(510		)	—		510		—			(439		)	71
Other		—		—			—			—		600		—			(161		)	439
Subtotal	13	194,109		(27,234		)	(73,711		)	93,164		194,771		(27,234		)	(63,714		)	103,823

Intangible assets with indefinite lives:
Trademarks		141,740		(22,000		)	—			119,740		141,740		(22,000		)	—			119,740
Total		$	335,849	$	(49,234	)	$	(73,711	)	$	212,904	$	336,511	$	(49,234	)	$	(63,714	)	$	223,563

Annual amortization expense of intangible assets for the next five years is estimated to be as follows (in thousands):



	Annual Estimated Expense
2013	$	9,959
2014	9,718
2015	9,631
2016	7,876
2017	7,153

Sale of Assets

In 2012, the Company received proceeds of $5.7 million related to the buyout of a royalty agreement by a third party and certain other intellectual property. Prior to its sale, the royalty agreement was accounted for as an intangible asset in the Company's consolidated balance sheet. As a result of these transactions, the Company recorded a gain of $2.8 million in other (income) expense, net in its consolidated statement of operations.

- 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.

+ References+ Details