Annual report pursuant to Section 13 and 15(d)

Goodwill And Other Intangible Assets

v3.8.0.1
Goodwill And Other Intangible Assets
12 Months Ended
Dec. 31, 2017
Goodwill And Other Intangible Assets [Abstract]  
Goodwill And Other Intangible Assets

NOTE 6.  GOODWILL AND OTHER INTANGIBLE ASSETS



Goodwill



There was a decrease in goodwill related to the Black Diamond segment during the year ended December 31, 2015 due to the impairment of goodwill.  During the fourth quarter of the year ended December 31, 2015, there was a decrease in the Company’s market capitalization which was determined to be a triggering event for potential goodwill impairment.  Accordingly, the Company performed a goodwill impairment analysis.  The Company utilized the market capitalization, plus a reasonable control premium to estimate the fair value.  Our total stockholders’ equity exceeded the estimated fair value by $32,754.  The failure of step one of the goodwill impairment test triggered a step two impairment test.  As a result of step two of the impairment test, the Company determined the implied fair value of goodwill and concluded that the carrying value of goodwill exceeded its implied fair value as of December 31, 2015.  Accordingly, an impairment charge of $29,507, which represents a full impairment charge, was recognized in the fourth quarter of 2015.  As of December 31, 2016, there was no goodwill recorded. 



There was an increase in goodwill during the year ended December 31, 2017 to $17,745, due to the Company’s acquisition of Sierra on August 21, 2017.  Based on the results of the Company’s annual impairment tests completed during the fourth quarter, the Company determined that goodwill was not impaired.  The following table summarizes the changes in goodwill:











 

 

 

 

 

 

 

 

 



 

Black Diamond

 

Sierra

 

Total



 

 

 

 

 

 

 

 

 

Balance at December 31, 2015

 

$

 -

 

$

 -

 

$

 -



 

 

 

 

 

 

 

 

 

Balance at December 31, 2016

 

$

 -

 

$

 -

 

$

 -



 

 

 

 

 

 

 

 

 

Increase due to acquisition

 

 

 -

 

 

17,745 

 

 

17,745 



 

 

 

 

 

 

 

 

 

Balance at December 31, 2017

 

$

 -

 

$

17,745 

 

$

17,745 



Indefinite Lived Intangible Assets 

 

The Company owns certain tradenames and trademarks which provide Black Diamond Equipment, PIEPS and Sierra with the exclusive and perpetual rights to manufacture and sell their respective products.  Tradenames and trademarks are not amortized, but reviewed annually for impairment or upon the existence of a triggering event.  There was an increase in tradenames and trademarks during the year ended December 31, 2017 due to the Company’s acquisition of Sierra and the impact of foreign currency exchange rates.  Based on the results of the Company’s annual impairment tests, the Company determined that indefinite lived intangible assets were not impaired.  The following table summarizes the changes in indefinite lived intangible assets:







 

 

 

Balance at December 31, 2016

 

$

22,541 



 

 

 

Increase due to acquisition

 

 

18,900 

Impact of foreign currency exchange rates

 

 

402 



 

 

 

Balance at December 31, 2017

 

$

41,843 



 

 

 

Other Intangible Assets, net



Intangible assets such as certain customer relationships, core technologies, tradenames and product technologies are amortizable over their estimated useful lives.  There was an increase in gross other intangible assets subject to amortization during the year ended December 31, 2017 due to the acquisition of Sierra and the impact of foreign currency exchange rates.  The following table summarizes the changes in gross other intangible assets:







 

 

 

Gross balance at December 31, 2016

 

$

16,980 



 

 

 

Increase due to acquisition

 

 

15,500 

Impact of foreign currency exchange rates

 

 

582 



 

 

 

Gross balance at December 31, 2017

 

$

33,062 



 

 

 

Intangible assets, net of amortization as of December 31, 2017 and December 31, 2016, were as follows: 









 

 

 

 

 

 

 

 

 

 

 

 



 

December 31, 2017



 

Gross

 

Accumulated Amortization

 

Net

 

Weighted Average Useful Life



 

 

 

 

 

 

 

 

 

 

 

 

Intangibles subject to amortization

 

 

 

 

 

 

 

 

 

 

 

 

Customer relationships

 

$

26,166 

 

$

(7,841)

 

$

18,325 

 

 

15.1 years

Product technologies

 

 

4,849 

 

 

(1,203)

 

 

3,646 

 

 

12.0 years

Trade name / trademark

 

 

1,100 

 

 

(62)

 

 

1,038 

 

 

10.0 years

Core technologies

 

 

947 

 

 

(718)

 

 

229 

 

 

10.0 years



 

$

33,062 

 

$

(9,824)

 

$

23,238 

 

 

14.4 years



 

 

 

 

 

 

 

 

 

 

 

 



 

December 31, 2016



 

Gross

 

Accumulated Amortization

 

Net

 

Weighted Average Useful Life



 

 

 

 

 

 

 

 

 

 

 

 

Intangibles subject to amortization

 

 

 

 

 

 

 

 

 

 

 

 

Customer relationships

 

$

13,942 

 

$

(5,843)

 

$

8,099 

 

 

15.3 years

Product technologies

 

 

2,091 

 

 

(745)

 

 

1,346 

 

 

14.0 years

Core technologies

 

 

947 

 

 

(623)

 

 

324 

 

 

10.0 years



 

$

16,980 

 

$

(7,211)

 

$

9,769 

 

 

14.9 years









Amortization expense for continuing operations for the years ended December 31, 2017, 2016, and 2015, was $2,376, $1,075, and $1,245, respectively.  Future amortization expense for other intangible assets as of December 31, 2017 is as follows:  







 

 

 

2018

 

 

3,871 

2019

 

 

3,538 

2020

 

 

3,024 

2021

 

 

2,606 

2022

 

 

2,296 

Thereafter

 

 

7,903 



 

$

23,238