XML 27 R13.htm IDEA: XBRL DOCUMENT
v3.19.2

Goodwill and Intangibles | 12 Months Ended
--- | ---
Jun. 30, 2019
Goodwill and Intangible Assets Disclosure [Abstract] |
GOODWILL AND INTANGIBLES | GOODWILL AND INTANGIBLES The changes in the carrying amount of goodwill for both the Service Center Based Distribution segment and the Fluid Power & Flow Control segment for the years ended June 30, 2019 and 2018 are as follows:
| Service Center Based Distribution |  |  | Fluid Power & Flow Control |  |  | Total |
Balance at July 1, 2017 | $ | 201,740 |  |  | $ | 4,395 |  |  | $ | 206,135 |
Goodwill added during the year | 2,525 |  |  | 439,164 |  |  | 441,689 |
Other, primarily currency translation | (1,181 | ) |  | — |  |  | (1,181 | )
Balance at June 30, 2018 | 203,084 |  |  | 443,559 |  |  | 646,643 |
Goodwill added during the year | 9,943 |  |  | 4,798 |  |  | 14,741 |
Other, primarily currency translation | 607 |  |  | — |  |  | 607 |
Balance at June 30, 2019 | $ | 213,634 |  |  | $ | 448,357 |  |  | $ | 661,991 |
The Company has seven (7) reporting units for which an annual goodwill impairment assessment was performed as of January 1, 2019. The Company concluded that all of the reporting units’ fair value exceeded their carrying amounts by at least 20% as of January 1, 2019. Specifically, the Canada reporting unit's fair value exceeded its carrying value by 25%. The Canada reporting unit has a goodwill balance of $28,327 as of June 30, 2019. The fair values of the reporting units in accordance with the goodwill impairment test were determined using the income and market approaches. The income approach employs the discounted cash flow method reflecting projected cash flows expected to be generated by market participants and then adjusted for time value of money factors, and requires management to make significant estimates and assumptions related to forecasts of future revenues, operating margins, and discount rates. The market approach utilizes an analysis of comparable publicly traded companies and requires management to make significant estimates and assumptions related to the forecasts of future revenues, earnings before interest, taxes, depreciation, and amortization (EBITDA) and multiples that are applied to management’s forecasted revenues and EBITDA estimates. Changes in future results, assumptions, and estimates after the measurement date may lead to an outcome where additional impairment charges would be required in future periods. Specifically, actual results may vary from the Company’s forecasts and such variations may be material and unfavorable, thereby triggering the need for future impairment tests where the conclusions may differ in reflection of prevailing market conditions. At June 30, 2019 and 2018, accumulated goodwill impairment losses subsequent to fiscal year 2002 totaled $64,794 related to the Service Center Based Distribution segment and $36,605 related to the Fluid Power & Flow Control segment. The Company's identifiable intangible assets resulting from business combinations are amortized over their estimated period of benefit and consist of the following:
June 30, 2019 | Amount |  |  | Accumulated Amortization |  |  | Net Book Value |
Finite-Lived Intangibles: |  |  |  |  |
Customer relationships | $ | 422,367 |  |  | $ | 135,879 |  |  | $ | 286,488 |
Trade names | 105,946 |  |  | 27,232 |  |  | 78,714 |
Vendor relationships | 11,367 |  |  | 8,156 |  |  | 3,211 |
Non-competition agreements | 2,702 |  |  | 2,249 |  |  | 453 |
Total Intangibles | $ | 542,382 |  |  | $ | 173,516 |  |  | $ | 368,866 |
June 30, 2018 | Amount |  |  | Accumulated Amortization |  |  | Net Book Value |
Finite-Lived Intangibles: |  |  |  |  |
Customer relationships | $ | 465,691 |  |  | $ | 125,009 |  |  | $ | 340,682 |
Trade names | 112,939 |  |  | 22,454 |  |  | 90,485 |
Vendor relationships | 11,425 |  |  | 7,382 |  |  | 4,043 |
Non-competition agreements | 2,761 |  |  | 2,024 |  |  | 737 |
Total Intangibles | $ | 592,816 |  |  | $ | 156,869 |  |  | $ | 435,947 |
Amounts include the impact of foreign currency translation. Fully amortized amounts are written off. During fiscal 2019, the Company acquired identifiable intangible assets with a preliminary acquisition cost allocation and weighted-average life as follows:
| Acquisition Cost Allocation |  |  | Weighted-Average Life
Customer relationships | $ | 5,956 |  |  | 20.0
Trade names | 941 |  |  | 5.0
Non-competition agreements | 250 |  |  | 5.0
Total Intangibles Acquired | $ | 7,147 |  |  | 17.5
Due to a sustained decline in economic conditions in the upstream oil and gas industry in western Canada, management also assessed the long-lived intangible assets related to the Reliance asset group in Canada for impairment during the third quarter of fiscal 2019. The Reliance asset group is located in western Canada and primarily serves customers in the upstream oil and gas industry. The asset group carrying value exceeded the sum of the undiscounted cash flows, indicating impairment. The fair value of the asset group was then determined using the income approach, using Level 3 assumptions in the fair value hierarchy, and the analysis resulted in the measurement of a full impairment loss of $31,594, which was recorded in the third quarter of fiscal 2019. Amortization of identifiable intangibles totaled $41,883, $32,065 and $24,371 in fiscal 2019, 2018 and 2017, respectively, and is included in selling, distribution and administrative expenses in the statements of consolidated income. Future amortization expense based on the Company’s identifiable intangible assets as of June 30, 2019 is estimated to be $39,000 for 2020, $36,900 for 2021, $34,800 for 2022, $32,600 for 2023 and $28,600 for 2024.

X
- References No definition available. + Details
Name: | us-gaap_GoodwillAndIntangibleAssetsDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for goodwill and intangible assets. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 350 -URI http://asc.fasb.org/topic&trid=2144416 + Details
Name: | us-gaap_GoodwillAndIntangibleAssetsDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | nonnum:textBlockItemType
Balance Type: | na
Period Type: | duration