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Goodwill and Other Identifiable Intangible Assets | 12 Months Ended
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Jun. 30, 2011
Goodwill and Other Identifiable Intangible Assets |
Goodwill and Other Identifiable Intangible Assets |
(6) | Goodwill and Other Identifiable Intangible Assets
In accordance with ASC 350, Intangibles – Goodwill and Others, the Company performs its annual goodwill impairment test at the end of each fiscal year, or whenever indicators of impairment are present. This testing includes the determination of each reporting unit's fair value using market multiples and discounted cash flows modeling. These reporting units are also the Company's operating segments. During fiscal years 2011, 2010 and 2009, no impairment charges related to goodwill were recorded. Changes in the carrying amount of goodwill for the years ended June 30, 2011 and 2010, by reporting segment, are as follows:
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|  | North American Distribution Segment |  |  | International Distribution Segment |  |  | Total |
|  | (in thousands) |
Balance as of June 30, 2009 |  | $ | 20,081 |  |  | $ | 14,006 |  |  | $ | 34,087 |
Goodwill acquired during 2010 |  |  | - |  |  |  | 712 |  |  |  | 712 |
Fluctuations in foreign currencies |  |  | - |  |  |  | (1,014 | ) |  |  | (1,014 | )
Balance as of June 30, 2010 |  | $ | 20,081 |  |  | $ | 13,704 |  |  | $ | 33,785 |
Goodwill acquired during 2011 |  |  | - |  |  |  | 24,643 |  |  |  | 24,643 |
Fluctuations in foreign currencies |  |  | - |  |  |  | 662 |  |  |  | 662 |
Balance as of June 30, 2011 |  | $ | 20,081 |  |  | $ | 39,009 |  |  | $ | 59,090 |
During the fiscal year ended June 30, 2011, the Company's goodwill balances increased due to the acquisition of CDC in April, 2011. The goodwill recognized in conjunction with the CDC acquisition is attributable to the depth and breadth of services that it can provide to South America's largest economy, its vast geographical reach beyond that of other distributors in Brazil and its large, specialty product mix that is atypical for the region. The Company expects all of the goodwill acquired with CDC to be deductible for Brazilian tax purposes. During the fiscal year ended June 30, 2010, the Company's goodwill balances increased due to the acquisition of Algol Europe in November 2009. All other changes in goodwill are due to fluctuations in foreign exchange rates on foreign currency denominated amounts. The following table shows the Company's identifiable intangible assets as of June 30, 2011 and 2010, respectively. These balances are included on the Consolidated Balance Sheet within other assets:
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|  | June 30, 2011 |  |  | June 30, 2010 |
|  | Gross Carrying Amount |  |  | Accumulated Amortization |  |  | Net Book Value |  |  | Gross Carrying Amount |  |  | Accumulated Amortization |  |  | Net Book Value |
|  | (in thousands) |
Amortized intangible assets: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Customer relationships |  | $ | 34,515 |  |  | $ | 6,989 |  |  | $ | 27,526 |  |  | $ | 20,083 |  |  | $ | 5,497 |  |  | $ | 14,586 |
Debt issue costs |  |  | 1,139 |  |  |  | 625 |  |  |  | 514 |  |  |  | 885 |  |  |  | 427 |  |  |  | 458 |
Trade names |  |  | 2,743 |  |  |  | 286 |  |  |  | 2,457 |  |  |  | 947 |  |  |  | 947 |  |  |  | - |
Non-compete agreements |  |  | 2,310 |  |  |  | 1,085 |  |  |  | 1,225 |  |  |  | 2,987 |  |  |  | 2,112 |  |  |  | 875 |
Distributor agreement |  |  | 705 |  |  |  | 74 |  |  |  | 631 |  |  |  | 598 |  |  |  | 23 |  |  |  | 575 |
Total |  | $ | 41,412 |  |  | $ | 9,059 |  |  | $ | 32,353 |  |  | $ | 25,500 |  |  | $ | 9,006 |  |  | $ | 16,494 |
In fiscal 2011, the Company wrote off the gross carrying amount and corresponding accumulated amortization for fully amortized customer lists, non-compete agreements and trade names in the amounts of $0.3 million, $1.8 million and $1.0 million, respectively. The weighted average amortization period for all intangible assets for the years ended June 30, 2011, 2010 and 2009 was approximately 10 years, 12 years, and 13 years, respectively. Amortization expense for the years ended June 30, 2011, 2010 and 2009 was $3.0 million, $2.0 million and $2.6 million, respectively. Estimated future amortization expense is as follows:
|  | Amortization expense |
|  | (in thousands) |
Year Ended June 30, |  |  |  |
2012 |  | $ | 5,743 |
2013 |  |  | 4,909 |
2014 |  |  | 3,509 |
2015 |  |  | 3,698 |
2016 |  |  | 3,676 |
Thereafter |  |  | 10,818 |
|  | $ | 32,353 |

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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 -SubTopic 20 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6905597&loc=d3e13816-109267 Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 350 -SubTopic 30 -Section 50 -Paragraph 1 -URI http://asc.fasb.org/extlink&oid=6905858&loc=d3e16265-109275 Reference 3: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 142 -Paragraph 42, 43, 44, 45, 46, 47 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 4: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 350 -SubTopic 30 -Section 50 -Paragraph 3 -URI http://asc.fasb.org/extlink&oid=6905858&loc=d3e16373-109275 Reference 5: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 350 -SubTopic 30 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6905858&loc=d3e16323-109275 Reference 6: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 350 -SubTopic 20 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=6905597&loc=d3e13854-109267 + Details
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