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Goodwill and Other Intangible Assets | 12 Months Ended
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Dec. 30, 2017
Goodwill And Intangible Assets Disclosure [Abstract] |
Goodwill and Other Intangible Assets | Note 5 – Goodwill and Other Intangible Assets The Company has three reportable segments; however, no goodwill has existed within the Military segment. Changes in the carrying amount of goodwill were as follows:
|  |  |  |  |  |  | Food |  |  |  |  |  |  |  |  |  |  |  |  |
(In thousands) |  |  |  |  |  |  | Distribution |  |  | Retail |  |  |  | Total |  |
Balance at January 2, 2016: |  |  |  |  |  |  | $ |  | 132,367 |  |  |  |  | 190,535 |  | (a) |  | $ |  | 322,902 |  | (a)
Other |  |  |  |  |  |  |  |  | — |  |  |  |  | (216 | ) |  |  |  |  | (216 | ) |
Balance at December 31, 2016: |  |  |  |  |  |  |  |  | 132,367 |  |  |  |  | 190,319 |  | (a) |  |  |  | 322,686 |  | (a)
Acquisitions (Note 2) |  |  |  |  |  |  |  |  | 46,281 |  |  |  |  | — |  |  |  |  |  | 46,281 |  |
Disposals |  |  |  |  |  |  |  |  | — |  |  |  |  | (1,292 | ) |  |  |  |  | (1,292 | ) |
Impairment |  |  |  |  |  |  |  |  | — |  |  |  |  | (189,027 | ) |  |  |  |  | (189,027 | ) |
Balance at December 30, 2017: |  |  |  |  |  |  | $ |  | 178,648 |  |  | $ |  | — |  | (b) |  | $ |  | 178,648 |  | (b)
(a) Net of accumulated impairment charges of $86.6 million. (b) Net of accumulated impairment charges of $275.6 million. The Company reviews goodwill and other intangible assets for impairment annually, during the fourth quarter of each year, and more frequently if circumstances indicate the possibility of impairment. Testing goodwill and other intangible assets for impairment requires management to make significant estimates about the Company’s future performance, cash flows, and other assumptions that can be affected by potential changes in economic, industry or market conditions, business operations, competition, or the Company’s stock price and market capitalization. On the first day of the third quarter of 2017, the Company early adopted ASU 2017-04, which simplifies the subsequent measurement of goodwill by eliminating Step 2 of the goodwill impairment test. In the third quarter of 2017, the Company experienced significantly lower than expected Retail operating results and, due to an increasingly competitive retail environment and the related pricing pressures that are anticipated to negatively impact gross margin, lower operating profit. As a result, the Company revised its future cash flow projections for the Retail reporting unit and performed Step 1 of the goodwill impairment test by calculating the fair value of the Retail reporting unit based on its discounted estimated future cash flows. The Company then benchmarked the calculated fair value against a market approach using the guideline public companies method. Given there had been a sustained decline in the market multiples of publicly traded peer companies, management considered this market information when assessing the reasonableness of the fair value of the reporting unit under both the income and market approaches. Based on the factors outlined above, together with the results of the Step 1 goodwill impairment test, it was determined that the carrying value of the Retail segment exceeded its fair value. Consequently, the Company recorded a goodwill impairment charge of $189.0 million. The Company completed its impairment analysis in the fourth quarter, which did not result in any changes to the impairment recorded in the third quarter. The measurement of the fair value of the Retail segment required significant judgments and estimates regarding short- and long-term growth rates and profitability, as well as assumptions regarding the market valuation of the business. These represent Level 3 valuation inputs under the ASC 820 fair value hierarchy, as further described in Note 8, Fair Value Measurements. As of the date of the most recent goodwill impairment test, which utilized data and assumptions as of October 7, 2017, the Food Distribution reporting unit had a fair value that was substantially in excess of its carrying value. The following table reflects the components of amortized intangible assets, included in “Intangible assets, net” on the consolidated balance sheets:
|  |  |  | December 30, 2017 |  |  | December 31, 2016 |
|  |  |  | Gross |  |  |  |  |  |  |  | Gross |  |  |  |  |  |
|  |  |  | Carrying |  |  | Accumulated |  |  | Carrying |  |  | Accumulated |
(In thousands) |  |  |  | Amount |  |  | Amortization |  |  | Amount |  |  | Amortization |
Non-compete agreements |  |  |  | $ |  | 3,408 |  |  | $ |  | 397 |  |  | $ |  | 1,244 |  |  | $ |  | 978 |
Favorable leases |  |  |  |  |  | 8,251 |  |  |  |  | 4,332 |  |  |  |  | 8,744 |  |  |  |  | 3,807 |
Pharmacy customer prescription lists |  |  |  |  |  | 6,810 |  |  |  |  | 4,210 |  |  |  |  | 7,168 |  |  |  |  | 3,445 |
Customer relationships |  |  |  |  |  | 57,937 |  |  |  |  | 4,173 |  |  |  |  | 17,633 |  |  |  |  | 2,187 |
Trade names |  |  |  |  |  | 1,068 |  |  |  |  | 386 |  |  |  |  | 1,068 |  |  |  |  | 236 |
Franchise fees and other |  |  |  |  |  | 1,047 |  |  |  |  | 381 |  |  |  |  | 929 |  |  |  |  | 270 |
Total |  |  |  | $ |  | 78,521 |  |  | $ |  | 13,879 |  |  | $ |  | 36,786 |  |  | $ |  | 10,923 |
The weighted average amortization periods for amortizable intangible assets as of December 30, 2017 are as follows:
Non-compete agreements |  |  |  |  |  |  |  |  |  |  |  |  |  | 6.3 years
Favorable leases |  |  |  |  |  |  |  |  |  |  |  |  |  | 16.4 years
Pharmacy customer prescription lists |  |  |  |  |  |  |  |  |  |  |  |  |  | 7.5 years
Customer relationships |  |  |  |  |  |  |  |  |  |  |  |  |  | 16.1 years
Trade names |  |  |  |  |  |  |  |  |  |  |  |  |  | 7.0 years
Franchise fees and other |  |  |  |  |  |  |  |  |  |  |  |  |  | 9.3 years
Amortization expense for intangible assets was $5.5 million, $3.0 million and $3.3 million for 2017, 2016 and 2015, respectively. Estimated amortization expense for each of the five succeeding fiscal years is as follows:
(In thousands) | 2018 |  |  | 2019 |  |  | 2020 |  |  | 2021 |  |  | 2022 |
Amortization expense | $ |  | 5,772 |  |  | $ |  | 5,604 |  |  | $ |  | 5,267 |  |  | $ |  | 4,620 |  |  | $ |  | 4,362 |
Indefinite-lived intangible assets that are not amortized, consisting primarily of trade names and licenses for the sale of alcoholic beverages, totaled $69.8 million and $34.3 million as of December 30, 2017 and December 31, 2016, 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 -URI http://asc.fasb.org/topic&trid=2144416 + Details
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