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GOODWILL AND INTANGIBLE ASSETS | 12 Months Ended
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Feb. 28, 2014
GOODWILL AND INTANGIBLE ASSETS |
GOODWILL AND INTANGIBLE ASSETS | NOTE 4 – GOODWILL AND INTANGIBLE ASSETS We do not record amortization expense for goodwill or other intangible assets that have indefinite useful lives. Amortization expense is recorded for intangible assets with definite useful lives. We perform an annual impairment review of goodwill and other intangible assets during the first quarter of each fiscal year. We also perform interim testing, if necessary, as required by GAAP. We write down any asset deemed to be impaired to its fair value. The Company’s traditional impairment test methodology uses primarily estimated future discounted cash flow models (“DCF Models”). The DCF Models use a number of assumptions including expected future cash flows from the assets, volatility, risk free rate, and the expected life of the assets, the determination of which require significant judgments from management. In determining the assumptions to be used, the Company considers the existing rates on Treasury Bills, yield spreads on assets with comparable expected lives, historical volatility of the Company’s common stock and that of comparable companies and general economic and industry trends, among other considerations. When stock market or other conditions warrant, the Company expands its traditional impairment test methodology to give weight to other methods that provide additional observable market information in order to better reflect the current risk level being incorporated into market prices and in order to corroborate the fair values of each of the Company’s reporting units. Management will place increased reliance on these additional methods in conjunction with its DCF Models in the event that the total market capitalization of its stock drops below its consolidated stockholders’ equity balance for a sustained period of time. Considerable management judgment is necessary in reaching a conclusion regarding the reasonableness of fair value estimates, evaluating the most likely impact of a range of possible external conditions, considering the resulting operating changes and their impact on estimated future cash flows, determining the appropriate discount factors to use, and selecting and weighting appropriate comparable market level inputs. Annual Impairment Testing in the First Quarter of Fiscal Year 2014 - The Company performed our annual evaluation of goodwill and indefinite-lived intangible assets for impairment during the first quarter of fiscal year 2014. As a result of our testing of indefinite-lived trademarks and licenses, we recorded a non-cash asset impairment charge of $12.05 million ($12.03 million after tax). The charge was related to certain trademarks in our Personal Care segment, which were written down to their estimated fair value, determined on the basis of future discounted cash flows using the relief from royalty valuation method. Annual Impairment Testing in the First Quarter of Fiscal Years 2013 and 2012 - The Company performed its annual evaluations of goodwill and indefinite-lived intangible assets for impairment during the first quarter of fiscal years 2013 and 2012. As a result of its testing, the Company concluded no impairment charges were required in either fiscal year as the estimated fair value of the indefinite-lived trademarks and licenses, reporting unit net assets and the Company’s estimated enterprise value exceeded their respective carrying values as of the dates of each evaluation. The following tables summarize by operating segment the changes in our goodwill and intangible assets for fiscal years 2014 and 2013: GOODWILL AND INTANGIBLE ASSETS (in thousands)
|  |  |  | Balances at |  |  |  |  |  |  |  | Balances at
|  | Weighted |  | February 28, 2013 |  | Year Ended February 28, 2014 |  | February 28, 2014 |
|  | Average |  | Gross |  | Cumulative |  |  |  |  |  | Acquisition |  | Gross |  | Cumulative |  |  |  |  |
|  | Life |  | Carrying |  | Goodwill |  |  |  |  |  | and Retirement |  | Carrying |  | Goodwill |  | Accumulated |  | Net Book |
Description |  | (Years) |  | Amount |  | Impairments |  | Additions |  | Impairments |  | Adjustments |  | Amount |  | Impairments |  | Amortization |  | Value |
Housewares: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Goodwill |  |  |  | $ | 166,132 |  | $ | - |  | $ | - |  | $ | - |  | $ | - |  | $ | 166,132 |  | $ | - |  | $ | - |  | $ | 166,132 |
Trademarks - indefinite |  |  |  | 75,200 |  | - |  | - |  | - |  | - |  | 75,200 |  | - |  | - |  | 75,200 |
Other intangibles - finite |  | 2.7 |  | 15,609 |  | - |  | 339 |  | - |  | (255) |  | 15,693 |  | - |  | (11,149) |  | 4,544 |
Total Housewares |  |  |  | 256,941 |  | - |  | 339 |  | - |  | (255) |  | 257,025 |  | - |  | (11,149) |  | 245,876 |
Healthcare / Home Environment: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Goodwill |  |  |  | 251,758 |  | - |  | - |  | - |  | - |  | 251,758 |  | - |  | - |  | 251,758 |
Trademarks - indefinite |  |  |  | 54,000 |  | - |  | - |  | - |  | - |  | 54,000 |  | - |  | - |  | 54,000 |
Licenses - finite |  | 3.0 |  | 15,300 |  | - |  | - |  | - |  | - |  | 15,300 |  | - |  | (6,416) |  | 8,884 |
Other Intangibles - finite |  | 7.6 |  | 114,490 |  | - |  | - |  | - |  | - |  | 114,490 |  | - |  | (34,606) |  | 79,884 |
Total Healthcare / Home Environment |  |  |  | 435,548 |  | - |  | - |  | - |  | - |  | 435,548 |  | - |  | (41,022) |  | 394,526 |
Personal Care: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Goodwill |  |  |  | 81,841 |  | (46,490) |  | - |  | - |  | - |  | 81,841 |  | (46,490) |  | - |  | 35,351 |
Trademarks - indefinite |  |  |  | 75,803 |  | - |  | - |  | (12,049) |  | - |  | 63,754 |  | - |  | - |  | 63,754 |
Trademarks - finite |  | 14.6 |  | 150 |  | - |  | - |  | - |  | - |  | 150 |  | - |  | (77) |  | 73 |
Licenses - indefinite |  |  |  | 10,300 |  | - |  | - |  | - |  | - |  | 10,300 |  | - |  | - |  | 10,300 |
Licenses - finite |  | 6.5 |  | 18,683 |  | - |  | - |  | - |  | - |  | 18,683 |  | - |  | (15,887) |  | 2,796 |
Other intangibles - finite |  | 4.0 |  | 49,437 |  | - |  | - |  | - |  | - |  | 49,437 |  | - |  | (26,563) |  | 22,874 |
Total Personal Care |  |  |  | 236,214 |  | (46,490) |  | - |  | (12,049) |  | - |  | 224,165 |  | (46,490) |  | (42,527) |  | 135,148 |
Total |  |  |  | $ | 928,703 |  | $ | (46,490) |  | $ | 339 |  | $ | (12,049) |  | $ | (255) |  | $ | 916,738 |  | $ | (46,490) |  | $ | (94,698) |  | $ | 775,550 |
GOODWILL AND INTANGIBLE ASSETS (in thousands)
|  |  |  | Balances at |  |  |  |  |  |  |  | Balances at
|  | Weighted |  | February 29, 2012 |  | Year Ended February 28, 2013 |  | February 28, 2013 |
|  | Average |  | Gross |  | Cumulative |  |  |  |  |  | Acquisition |  | Gross |  | Cumulative |  |  |  |  |
|  | Life |  | Carrying |  | Goodwill |  |  |  |  |  | and Retirement |  | Carrying |  | Goodwill |  | Accumulated |  | Net Book |
Description / Life |  | (Years) |  | Amount |  | Impairments |  | Additions |  | Impairments |  | Adjustments |  | Amount |  | Impairments |  | Amortization |  | Value |
Housewares: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Goodwill |  |  |  | $ | 166,132 |  | $ | - |  | $ | - |  | $ | - |  | $ | - |  | $ | 166,132 |  | $ | - |  | $ | - |  | $ | 166,132 |
Trademarks - indefinite |  |  |  | 75,200 |  | - |  | - |  | - |  | - |  | 75,200 |  | - |  | - |  | 75,200 |
Other intangibles - finite |  | 3.7 |  | 15,774 |  | - |  | 278 |  | - |  | (443) |  | 15,609 |  | - |  | (10,070) |  | 5,539 |
Total Housewares |  |  |  | 257,106 |  | - |  | 278 |  | - |  | (443) |  | 256,941 |  | - |  | (10,070) |  | 246,871 |
Healthcare / Home Environment: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Goodwill |  |  |  | 250,867 |  | - |  | - |  | - |  | 891 |  | 251,758 |  | - |  | - |  | 251,758 |
Trademarks - indefinite |  |  |  | 54,000 |  | - |  | - |  | - |  | - |  | 54,000 |  | - |  | - |  | 54,000 |
Licenses - finite |  | 4.0 |  | 14,900 |  | - |  | - |  | - |  | 400 |  | 15,300 |  | - |  | (3,455) |  | 11,845 |
Other Intangibles - finite |  | 8.6 |  | 114,790 |  | - |  | - |  | - |  | (300) |  | 114,490 |  | - |  | (23,220) |  | 91,270 |
Total Healthcare / Home Environment |  |  |  | 434,557 |  | - |  | - |  | - |  | 991 |  | 435,548 |  | - |  | (26,675) |  | 408,873 |
Personal Care: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Goodwill |  |  |  | 81,841 |  | (46,490) |  | - |  | - |  | - |  | 81,841 |  | (46,490) |  | - |  | 35,351 |
Trademarks - indefinite |  |  |  | 75,303 |  | - |  | 500 |  | - |  | - |  | 75,803 |  | - |  | - |  | 75,803 |
Trademarks - finite |  | 15.6 |  | 150 |  | - |  | - |  | - |  | - |  | 150 |  | - |  | (72) |  | 78 |
Licenses - indefinite |  |  |  | 10,300 |  | - |  | - |  | - |  | - |  | 10,300 |  | - |  | - |  | 10,300 |
Licenses - finite |  | 7.2 |  | 19,564 |  | - |  | - |  | - |  | (881) |  | 18,683 |  | - |  | (15,570) |  | 3,113 |
Other intangibles - finite |  | 5.0 |  | 49,437 |  | - |  | - |  | - |  | - |  | 49,437 |  | - |  | (20,957) |  | 28,480 |
Total Personal Care |  |  |  | 236,595 |  | (46,490) |  | 500 |  | - |  | (881) |  | 236,214 |  | (46,490) |  | (36,599) |  | 153,125 |
Total |  |  |  | $ | 928,258 |  | $ | (46,490) |  | $ | 778 |  | $ | - |  | $ | (333) |  | $ | 928,703 |  | $ | (46,490) |  | $ | (73,344) |  | $ | 808,869 |
The following table summarizes the amortization expense attributable to intangible assets for the fiscal years 2014, 2013 and 2012, as well as estimated amortization expense for the fiscal years 2015 through 2019:
AMORTIZATION OF INTANGIBLE ASSETS
(in thousands)
Aggregate Amortization Expense |  |  |
For the fiscal years ended |  |  |
February 2014 |  | $ | 21,612 |
February 2013 |  | $ | 22,400 |
February 2012 |  | $ | 20,069 |
Estimated Amortization Expense |  |  |
For the fiscal years ended |  |  |
February 2015 |  | $ | 21,021 |
February 2016 |  | $ | 20,838 |
February 2017 |  | $ | 20,523 |
February 2018 |  | $ | 16,704 |
February 2019 |  | $ | 12,000 |
Many of the license agreements under which we sell or intend to sell products with trademarks owned by other entities require that we pay minimum royalties. Some license agreements also require that we make minimum levels of advertising expenditures. For fiscal year 2015, estimated minimum royalties due and minimum advertising expenditures under these license agreements total $12.69 and $5.06 million, respectively.

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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 30 -Section 50 -Paragraph 2 -URI http://asc.fasb.org/extlink&oid=26713463&loc=d3e16323-109275 Reference 2: 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=14024403&loc=d3e13816-109267 Reference 3: 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=26713463&loc=d3e16373-109275 Reference 4: 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=26713463&loc=d3e16265-109275 Reference 5: 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=14024403&loc=d3e13854-109267 + Details
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