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Goodwill and Other Intangible Assets
 3 Months Ended
Sep. 30, 2016
Goodwill and Intangible Assets Disclosure [Abstract]  
GOODWILL AND OTHER INTANGIBLE ASSETS
GOODWILL AND OTHER INTANGIBLE ASSETS
Goodwill represents the excess of cost over the fair value of the net assets of acquired companies. Goodwill and other intangible assets with indefinite lives are tested at least annually for impairment. We perform our annual impairment tests during the June quarter in connection with our annual planning process, unless there are impairment indicators based on the results of an ongoing cumulative qualitative assessment that warrant a test prior to that. We evaluate the recoverability of goodwill for each of our reporting units by comparing the fair value of each reporting unit with its carrying value. The fair values of our reporting units are determined using a combination of a discounted cash flow analysis and market multiples based upon historical and projected financial information. We apply our best judgment when assessing the reasonableness of the financial projections used to determine the fair value of each reporting unit. We evaluate the recoverability of indefinite-lived intangible assets using a discounted cash flow analysis based on projected financial information. This evaluation is sensitive to changes in market interest rates and other external factors.
Identifiable assets with finite lives are reviewed for impairment when events or circumstances indicate that the carrying value may not be recoverable.
During the three months ended September 30, 2016, we reorganized our operating structure in a manner that changed the composition of our reporting units. The Industrial and WIDIA reporting units in fiscal 2017 were formed from the fiscal 2016 Industrial reporting unit. In connection with this reporting unit realignment, during the three months ended September 30, 2016 we updated our goodwill impairment assessment based on a quantitative analysis. We evaluated the goodwill of our reporting units immediately prior to and after the realignment and concluded in both cases that there was no impairment. We allocated our goodwill from the former Industrial segment to the current Industrial and WIDIA segments using a relative fair value approach. The restated Industrial reporting unit passed the goodwill impairment test with fair value substantially exceeded the carrying value. The new WIDIA reporting unit's fair value approximates its carrying value.
See Note 18 for further discussion regarding the Company's segments.
We are currently exploring strategic alternatives for one of our non-core Infrastructure businesses. The estimated net book value of the business is approximately $30 million as of September 30, 2016. As the strategic direction has not yet been determined for this business, the Company cannot determine if additional impairment charges will be incurred.
A summary of the carrying amount of goodwill attributable to each segment, as well as the changes in such, is as follows:
(in thousands)
Industrial
 
WIDIA
 
Infrastructure
 
Total
Gross goodwill
$
408,705

 
$
40,624

 
$
633,211

 
$
1,082,540

Accumulated impairment losses
(137,204
)
 
(13,638
)
 
(633,211
)
 
(784,053
)
Balance as of June 30, 2016
$
271,501

 
$
26,986

 
$
—

 
$
298,487

 
 
 
 
 
 
 
 
Activity for the three months ended September 30, 2016:
 
 
 
 
 
 
 
Change in gross goodwill due to translation
210

 
21

 
—

 
231

 
 
 
 
 
 
 
 
Gross goodwill
408,915

 
40,645

 
633,211

 
1,082,771

Accumulated impairment losses
(137,204
)
 
(13,638
)
 
(633,211
)
 
(784,053
)
Balance as of September 30, 2016
$
271,711

 
$
27,007

 
$
—

 
$
298,718


The components of our other intangible assets were as follows:
 
Estimated
Useful Life
(in years)
 
September 30, 2016
June 30, 2016
(in thousands)
 
Gross Carrying
Amount

 
Accumulated
Amortization

 
 
Gross Carrying
Amount

 
Accumulated
Amortization

Contract-based
3 to 15
 
$
7,063

 
$
(6,948
)
 
 
$
7,152

 
$
(6,886
)
Technology-based and other
4 to 20
 
46,506

 
(27,253
)
 
 
47,323

 
(27,011
)
Customer-related
10 to 21
 
205,377

 
(70,120
)
 
 
205,471

 
(66,938
)
Unpatented technology
10 to 30
 
31,820

 
(4,867
)
 
 
31,837

 
(4,614
)
Trademarks
5 to 20
 
12,357

 
(7,998
)
 
 
12,668

 
(8,644
)
Trademarks
Indefinite
 
16,934

 
—

 
 
16,850

 
—

Total
 
 
$
320,057

 
$
(117,186
)
 
 
$
321,301

 
$
(114,093
)

During the three months ended September 30, 2016 and 2015, we recorded amortization expense of $4.3 million and $6.2 million, respectively, related to our other intangible assets.