Goodwill

12 Months Ended

Mar. 31, 2023

Goodwill and Intangible Assets Disclosure [Abstract]

The following table summarizes the changes in the carrying value of goodwill by operating segment for each of 2021, 2022, and 2023:


(In thousands)	North American OTC Healthcare		International OTC Healthcare		Consolidated
Balance – March 31, 2021
Goodwill	$	710,354	$	32,683	$	743,037
Accumulated impairment losses	(163,711)		(1,247)		(164,958)
Balance - March 31, 2021	546,643		31,436		578,079

Acquisitions	1,648		—		1,648



Effects of foreign currency exchange rates	—		(411)		(411)
Impairment loss	—		(340)		(340)

Balance – March 31, 2022
Goodwill	712,002		32,272		744,274
Accumulated impairment losses	(163,711)		(1,587)		(165,298)
Balance - March 31, 2022	$	548,291	$	30,685	$	578,976

Adjustment related to acquisition	(550)		—		(550)



Effects of foreign currency exchange rates	—		(2,068)		(2,068)
Impairment loss	(48,805)		—		(48,805)

Balance – March 31, 2023
Goodwill	711,452		30,204		741,656
Accumulated impairment losses	(212,516)		(1,587)		(214,103)
Balance - March 31, 2023	$	498,936	$	28,617	$	527,553

As discussed in Note 2, on July 1, 2021, we completed the acquisition of the consumer health business assets from Akorn. In connection with this acquisition, we recorded goodwill of $1.1 million based on the amount by which the purchase price exceeded the estimate of the fair value of the net assets acquired.

At February 28, 2021, in conjunction with the annual test for goodwill impairment, we recorded an impairment charge of $1.2 million to adjust the carrying amount of goodwill related to our International Analgesics reporting unit in our International OTC Healthcare segment to its fair value. The goodwill impairment was a result of the Painstop tradename impairment discussed in Note 7.

At February 28, 2022, in conjunction with the annual test for goodwill impairment, we recorded an impairment charge of $0.3 million to write off the remaining goodwill related to our Painstop brand in our International OTC Healthcare segment.

At February 28, 2023, in conjunction with the annual test for goodwill impairment, which coincides with our annual strategic planning process, we recorded an impairment charge of $48.8 million to adjust the carrying amount of goodwill related to our North American Women's Health and North American Oral Care reporting units. The impairment charges were primarily a result of increased discount rates due to current macroeconomic conditions discussed in Note 7.

We identify our reporting units in accordance with the FASB ASC Subtopic 280. The carrying value and fair value for intangible assets and goodwill for a reporting unit are calculated based on key assumptions and valuation methodologies. The discounted cash flow methodology is a widely accepted valuation technique utilized by market participants in the transaction evaluation process and has been applied consistently. We also considered our market capitalization at February 28, 2023 and February 28, 2022, as compared to the aggregate fair values of our reporting units, to assess the reasonableness of our estimates pursuant to the discounted cash flow methodology. The estimates and assumptions made in assessing the fair value of our reporting units and the valuation of the underlying assets and liabilities are inherently subject to significant uncertainties related to future sales, gross margins, and advertising and marketing expenses, which can be impacted by increases in competition, changing consumer preferences, technical advances, supply chain constraints, labor shortages, and inflation. The discount rate

assumption may be influenced by such factors as changes in interest rates and rates of inflation, which can have an impact on the determination of fair value. If these assumptions are adversely affected, we may be required to record additional impairment charges in the future.

Our analysis at February 28, 2023 concluded that all other reporting units had a fair value that exceeded their carrying value by at least 10%. We performed a sensitivity analysis on our weighted average cost of capital, and we determined that a 50-basis point increase in the weighted average cost of capital would not have resulted in any of our other reporting units' fair value being less than their carrying value. Additionally, a 50-basis point decrease in the terminal growth rate used for each reporting unit would also not have resulted in any of our other reporting units' fair value being less than their carrying value.