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Goodwill and Other Intangible Assets | 9 Months Ended
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Oct. 07, 2017
Goodwill And Intangible Assets Disclosure [Abstract] |
Goodwill and Other Intangible Assets | 7. GOODWILL AND OTHER INTANGIBLE ASSETS The table below summarizes our goodwill and other intangible assets at October 7, 2017 and December 31, 2016, respectively, each of which is explained in additional detail below (amounts in thousands):
|  | October 7, 2017 |  |  | December 31, 2016 |
Goodwill |  | $ | 464,777 |  |  | $ | 465,578 |
Amortizable intangible assets, net of amortization |  |  | 541,927 |  |  |  | 592,964 |
Indefinite-lived intangible assets |  |  | 206,600 |  |  |  | 243,000 |
Total goodwill and other intangible assets |  | $ | 1,213,304 |  |  | $ | 1,301,542 |
The changes in the carrying amount of goodwill, by segment, during the forty weeks ended October 7, 2017, were as follows (amounts in thousands):
|  | DSD Segment |  |  | Warehouse Segment |  |  | Total |
Outstanding at December 31, 2016 |  | $ | 424,563 |  |  | $ | 41,015 |  |  | $ | 465,578 |
Change in goodwill related to divestiture |  |  | — |  |  |  | (801 | ) |  |  | (801 | )
Outstanding at October 7, 2017 |  | $ | 424,563 |  |  | $ | 40,214 |  |  | $ | 464,777 |
As of October 7, 2017 and December 31, 2016, respectively, the company had the following amounts related to amortizable intangible assets (amounts in thousands):
|  | October 7, 2017 |  |  | December 31, 2016 |
Asset |  | Cost |  |  | Accumulated Amortization |  |  | Net Value |  |  | Cost |  |  | Accumulated Amortization |  |  | Net Value |
Trademarks |  | $ | 372,480 |  |  | $ | 33,502 |  |  | $ | 338,978 |  |  | $ | 402,327 |  |  | $ | 25,129 |  |  | $ | 377,198 |
Customer relationships |  |  | 281,621 |  |  |  | 80,561 |  |  |  | 201,060 |  |  |  | 281,621 |  |  |  | 68,163 |  |  |  | 213,458 |
Non-compete agreements |  |  | 4,874 |  |  |  | 4,874 |  |  |  | — |  |  |  | 4,874 |  |  |  | 4,666 |  |  |  | 208 |
Distributor relationships |  |  | 4,123 |  |  |  | 2,234 |  |  |  | 1,889 |  |  |  | 4,123 |  |  |  | 2,023 |  |  |  | 2,100 |
Total |  | $ | 663,098 |  |  | $ | 121,171 |  |  | $ | 541,927 |  |  | $ | 692,945 |  |  | $ | 99,981 |  |  | $ | 592,964 |
Aggregate amortization expense for the twelve and forty weeks ended October 7, 2017 and October 8, 2016 was as follows (amounts in thousands):
|  | Amortization Expense |
For the twelve weeks ended October 7, 2017 |  | $ | 6,218 |
For the twelve weeks ended October 8, 2016 |  | $ | 5,586 |
For the forty weeks ended October 7, 2017 |  | $ | 21,190 |
For the forty weeks ended October 8, 2016 |  | $ | 18,979 |
Estimated amortization of intangibles for each of the next five years is as follows (amounts in thousands):
|  | Amortization of Intangibles |
Remainder of 2017 |  | $ | 6,005 |
2018 |  | $ | 25,780 |
2019 |  | $ | 25,288 |
2020 |  | $ | 24,795 |
2021 |  | $ | 24,230 |
During the twelve and forty weeks ended October 7, 2017, the company recognized intangible asset impairments of $66.2 million that are recorded in the restructuring and related impairment charges line item of our Condensed Consolidated Statements of Operations. The company is currently undergoing an enterprise-wide business and operational review as discussed in Note 4, Restructuring Activities, above. The review included a brand rationalization study that impacted certain trademarks’ future use. The study was completed in the third quarter of fiscal 2017. The study concluded that brands should be classified as either national or regional and brands that did not fit into those categories were to be discontinued. National brands would have more marketing support than the de-emphasized remaining regional brands and in many cases would shift sales from regional brands as certain regional brand bread products are discontinued. As a result of these actions, a triggering event occurred and we examined several trademarks for potential impairment. One of the trademarks was an indefinite-lived trademark asset and was tested by comparing the fair value of the brand to its carrying value. Three finite-lived trademark assets were tested using an undiscounted cash flow test. As a result of this test, the projected cash flows for these brands did not exceed the carrying value. The second step of the test determined the fair value of the asset and the difference between the fair value and the carrying value was recorded as an impairment. The impairment charge also consisted of six brands that either are being discontinued or will have limited future benefits to the company. These brands were fully impaired. All of these impairments were attributed to regional brands. Following the impairments, we evaluated the classification of the impaired indefinite-lived asset and determined that it should be reassigned as finite-lived with an estimated useful life of 30 years. The table below presents the impairments, by reporting segment, that were recognized during the twelve weeks ended October 7, 2017 (amounts in thousands):
|  | DSD Segment |  |  | Warehouse Segment |  |  | Total |
Indefinite-lived trademark asset impairments |  | $ | 18,500 |  |  | $ | — |  |  | $ | 18,500 |
Finite-lived trademark asset impairments |  |  | 36,612 |  |  |  | 11,135 |  |  |  | 47,747 |
Total |  | $ | 55,112 |  |  | $ | 11,135 |  |  | $ | 66,247 |
The remaining useful life for each of the impaired intangible assets was also reviewed at the time of the recoverability test. These brands will not be emphasized beyond their respective territories. We believe that these assets will continue to be recovered over a long period of time since the remaining regional brands are very strong and are long, well established brands in their territories. One finite-lived intangible asset was concluded to have about half the original estimated useful life and will be amortized over the shorter term. The remaining assets will continue to be amortized under their remaining terms ranging from eleven to thirty-eight years. There were $206.6 million and $243.0 million of indefinite-lived intangible trademark assets separately identified from goodwill at October 7, 2017 and December 31, 2016, respectively. These trademarks are classified as indefinite-lived because we believe they are well established brands, many older than forty years old, with a long history and well defined markets. In addition, we are continuing to use these brands both in their original markets and throughout our expansion territories. We believe these factors support an indefinite-life. We perform an annual impairment analysis, or on an interim basis if the facts and circumstances change, to determine if the trademarks are realizing their expected economic benefits.

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- 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 Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 350 -URI http://asc.fasb.org/topic&trid=2144416 + Details
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