Goodwill and Other Intangible Assets

12 Months Ended

Dec. 31, 2015

Goodwill And Intangible Assets Disclosure [Abstract]

NOTE 6. Goodwill and Other Intangible Assets

In accordance with the FASB issued guidance in the Intangibles-Goodwill and Other Topic of the Codification, we completed the required annual impairment tests. We performed a qualitative assessment on both the Hub segment goodwill and the Mode segment goodwill. No impairment charges were recognized based on the results of the annual goodwill assessments and there were no accumulated impairment losses of goodwill at the beginning of the period.

The following table presents the carrying amount of goodwill (in thousands):

						Hub Group
	Hub			Mode		Total
Balance at January 1, 2014	$	233,643		$	29,389	$	263,032
Other		(219	)	-			(219	)
Balance at December 31, 2014		233,424			29,389		262,813
Other		(219	)	-			(219	)
Balance at December 31, 2015	$	233,205		$	29,389	$	262,594

The changes noted as “other” in the table above for both 2015 and 2014 refer to the amortization of the income tax benefit of tax goodwill in excess of financial statement goodwill.

In December 2013, we decided to change our branding strategy for Comtrak Logistics which resulted in us retiring the Comtrak name. We decided to change the name of Comtrak to Hub Group Trucking, Inc. as we believed the name change would allow us to benefit from the valuable Hub Group name with customers, vendors and drivers. In conjunction with the strategy, the Comtrak name was no longer used, resulting in no fair value and a write off of the asset. We recorded an impairment charge of $2.9 million in 2013, which is included in the Impairment of trade name line item in the Consolidated Statements of Income and Comprehensive Income.

The components of the “Other intangible assets” are as follows (in thousands):

						Accumulated		Net
	Gross		Accumulated			Impairment		Carrying
As of December 31, 2015:	Amount		Amortization			Loss		Value		Life

Hub
Customer relationships	$	5,181	$	(3,350	)	$	-	$	1,831	7-15 years
Hub Total	$	5,181	$	(3,350	)	$	-	$	1,831

Mode
Agency/customer relationships	$	15,362	$	(4,054	)	$	-	$	11,308	18 years


Hub Group Total	$	20,543	$	(7,404	)	$	-	$	13,139

						Accumulated			Net
	Gross		Accumulated			Impairment			Carrying
As of December 31, 2014:	Amount		Amortization			Loss			Value		Life

Hub
Customer relationships	$	5,181	$	(2,909	)	$	-		$	2,272	7-15 years
Trade name		2,904		-			(2,904	)		-	Indefinite
Hub Total	$	8,085	$	(2,909	)	$	(2,904	)	$	2,272

Mode
Agency/customer relationships	$	15,362	$	(3,200	)	$	-		$	12,162	18 years


Hub Group Total	$	23,447	$	(6,109	)	$	(2,904	)	$	14,434

The above intangible assets are amortized using the straight-line method. Amortization expense, excluding impairment, for each of the years ended December 31, 2015, 2014 and 2013 was $1.3 million, $1.3 million and $1.4 million, respectively. The remaining weighted average life of all definite lived intangible assets as of December 31, 2015 was 4.49 years and 13.25 years for Hub and Mode, respectively. Amortization expense for the next five years is as follows (in thousands):

					Hub Group
	Hub		Mode		Total
2016	$	442	$	853	$	1,295
2017		442		853		1,295
2018		395		853		1,248
2019		255		853		1,108
2020		255		853		1,108

- 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