Goodwill and Other Intangibles

6 Months Ended

Jul. 13, 2013

5. GOODWILL AND OTHER INTANGIBLES

Goodwill activity for the twenty-eight weeks ended July 13, 2013 and the balances as of July 13, 2013 are as follows (amounts in thousands):


	DSD		Warehouse		Total
Balance as of December 29, 2012	$	262,796	$	7,101	$	269,897
Increase in goodwill related to acquisitions		1,437		—		1,437

Balance as of July 13, 2013	$	264,233	$	7,101	$	271,334

Goodwill increased by $0.3 million as a result of the final working capital adjustment for the Lepage acquisition that was paid during the second quarter of fiscal 2013. An additional $1.1 million of the increase in goodwill was the result of a reclassification from property, plant and equipment for an immaterial prior period adjustment related to a prior acquisition. The reclassification was corrected in the twelve weeks ended July 13, 2013.

As of July 13, 2013 and December 29, 2012, the company had the following amounts related to amortizable intangible assets (amounts in thousands):


	July 13, 2013						December 29, 2012
Asset	Cost		Accumulated Amortization		Net Value		Cost		Accumulated Amortization		Net Value
Trademarks	$	71,727	$	10,564	$	61,163	$	71,727	$	9,243	$	62,484
Customer relationships		169,921		28,770		141,151		157,921		24,275		133,646
Non-compete agreements		4,274		2,474		1,800		4,274		1,719		2,555
Distributor relationships		4,123		1,072		3,051		4,123		924		3,199
Supply agreement		1,050		1,050		—		1,050		1,050		—

Total	$	251,095	$	43,930	$	207,165	$	239,095	$	37,211	$	201,884

There are $266.0 million and $186.5 million of indefinite life intangible assets at July 13, 2013 and December 29, 2012, respectively. These are not being amortized and are separately identified from goodwill. The $27.8 million distribution rights intangible asset acquired in the Sara Lee California transaction was recorded to assets held for sale immediately subsequent to acquisition because we made the decision to disaggregate our distribution rights in California to the independent distributor model we use to deliver our products.

Aggregate amortization expense for the twelve and twenty-eight weeks ending July 13, 2013 and July 14, 2012 were as follows (amounts in thousands):


	Amortization Expense
For the twelve weeks ended July 13, 2013	$	2,881
For the twelve weeks ended July 14, 2012	$	1,752
For the twenty-eight weeks ended July 13, 2013	$	6,287
For the twenty-eight weeks ended July 14, 2012	$	4,245

Estimated amortization of intangibles for each of the next five years is as follows (amounts in thousands):


	Amortization of Intangibles
Remainder of 2013	$	5,455
2014	$	11,740
2015	$	11,495
2016	$	11,089
2017	$	10,597

- 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.

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