Goodwill And Intangible Assets

9 Months Ended

Sep. 30, 2016

Goodwill And Intangible Assets [Abstract]

5.GOODWILL AND INTANGIBLE ASSETS

Goodwill

The Company tests goodwill for impairment as of October 1 each year, or more frequently as circumstances indicate it is necessary. Testing compares the estimated fair values of our reporting units to the reporting units’ carrying values. The reporting units with goodwill balances as of September 30, 2016 include the operations at CRA, CDR and CPL. The Company considers a variety of factors when estimating the fair value of its reporting units, including estimates about the future operating results of each reporting unit, multiples of earnings, various market analyses, and recent sales of comparable businesses, if such information is available. The Company makes a variety of estimates and judgments about the relevance and comparability of these factors to the reporting units in estimating their fair values. If the carrying value of a reporting unit exceeds its estimated fair value, the fair value of each reporting unit is allocated to the reporting unit’s assets and liabilities to determine the implied fair value of the reporting unit’s goodwill and whether impairment is necessary. There have been no indications of impairment at CRA, CDR or CPL since the Company’s last annual analysis that would necessitate additional impairment testing by the Company.

Changes in the carrying amount of goodwill related to CRA, CDR and CPL are as follows:



	Canada				Poland
Amounts in thousands	Century Resorts Alberta		Century Downs		Casinos Poland		Total
Balance – December 31, 2015	$	3,551	$	137	$	6,485	$	10,173
Effect of foreign currency translation		196		7		194		397
Balance -- September 30, 2016	$	3,747	$	144	$	6,679	$	10,570

Intangible Assets

Trademarks

The Company currently owns two trademarks, the Century Casinos trademark and the Casinos Poland trademark, which are reported as intangible assets on the Company’s condensed consolidated balance sheets. Changes in the carrying amount of the trademarks are as follows:



Amounts in thousands	Century Casinos		Casinos Poland		Total
Balance -- December 31, 2015	$	108	$	1,546	$	1,654
Effect of foreign currency translation		0		46		46
Balance -- September 30, 2016	$	108	$	1,592	$	1,700

The Company has determined both trademarks have indefinite useful lives and therefore the Company does not amortize the trademarks. Rather, the Company tests its trademarks for impairment as of October 1 each year, or more frequently as circumstances indicate it is necessary. The Company tests trademarks for impairment using the relief-from-royalty method. If the fair value of an indefinite-lived intangible asset is less than its carrying amount, the Company would recognize an impairment charge equal to the difference. No impairment charges related to the Century Casinos and Casinos Poland trademarks have been recorded.

Casino Licenses

Casino licenses consist of the following:



	September 30,		December 31,
Amounts in thousands	2016		2015
Casino licenses	$	4,652	$	4,131
Less: accumulated amortization		(1,381)		(1,103)
Casino licenses, net	$	3,271	$	3,028

Casinos Poland

As of September 30, 2016, Casinos Poland had eight casino licenses, each with an original term of six years, which are finite-lived intangible assets and are amortized over their respective useful lives. Changes in the carrying amount of the Casinos Poland licenses are as follows:



Amounts in thousands		Casinos Poland
Balance – December 31, 2015	$	730
License renewal		339
Amortization		(294)
Effect of foreign currency translation		71
Balance -- September 30, 2016	$	846

As of September 30, 2016, estimated amortization expense for the CPL casino licenses over the next five years was as follows:



Amounts in thousands
2016	$	128
2017		346
2018		147
2019		70
2020		155
	$	846

Such estimates do not reflect the impact of future foreign exchange rate changes or the extension of the current licenses. The weighted average period before the current casino licenses expire is 1.7 years. In Poland, gaming licenses are not renewable. Once a gaming license has expired, any gaming company can apply for the license. In July 2016, the casino license at the Katowice casino expired. In October 2016, the Company was informed that it will not be granted the available license in Katowice. The casino operations at the Katowice casino have been moved to the Sosnowiec casino, and the casino license for Katowice was fully amortized as of September 30, 2016. The Company is working to obtain a new license for the Katowice casino as well as evaluating other potential business uses for the Katowice casino. There can be no guarantees that a new license will be granted. If the Company does not receive a new license or identify another business use, an impairment charge related to the Katowice leasehold improvements may be necessary. Such an impairment charge, if any, is not expected to have a material impact to the Company’s financial position or results of operations. In September 2016, the casino license at the Lim Center casino in Warsaw expired and the Company was granted a new license for the Lim Center casino.

Century Downs Racetrack and Casino

CDR currently has two licenses, one from the Alberta Gaming and Liquor Commission and one from HRA. The licenses are indefinite-lived intangible assets and therefore are not amortized. No impairment charges related to the CDR licenses have been recorded. Changes in the carrying amount of the CDR licenses are as follows:



Amounts in thousands	Century Downs
Balance – December 31, 2015	$	2,298
Effect of foreign currency translation		127
Balance -- September 30, 2016	$	2,425

- 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.

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