Cemex 2009 Annual Report Download - page 54

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52
12. GOODWILL, INTANGIBLE ASSETS AND DEFERRED CHARGES
As of December 31, 2009 and 2008, consolidated goodwill, intangible assets and deferred charges are summarized as follows:
2009 2008
Accumulated Carrying Accumulated Carrying
Cost amortization amount Cost amortization amount
Intangible assets of indefinite useful life:
Goodwill $ 150,827 – 150,827 $ 157,541 – 157,541
Intangible assets of definite useful life:
Extraction rights 28,986 (2,286) 26,700 30,466 (1,644) 28,822
Cost of internally developed software 7,807 (5,075) 2,732 7,997 (3,807) 4,190
Industrial property and trademarks 3,317 (1,908) 1,409 3,619 (1,564) 2,055
Customer relationships 4,936 (1,224) 3,712 5,281 (781) 4,500
Mining projects 2,161 (431) 1,730 1,219 (24) 1,195
Others intangible assets 7,635 (4,665) 2,970 8,007 (3,466) 4,541
Deferred charges and others:
Deferred income taxes (notes 16A and 16B) 1 36,751 – 36,751 20,909 – 20,909
Deferred financing costs 9,333 (1,655) 7,678 1,280 (446) 834
$ 251,753 (17,244) 234,509 $ 236,319 (11,732) 224,587
1 The balance of deferred taxes includes $3 and $11 of deferred ESPS in 2009 and 2008, respectively.
During 2009, CEMEX sold its assets in Australia. Goodwill and intangible assets in Australia for 2008 were reclassified to “Non-current assets from
discontinued operations” (note 4B).
The amortization of intangible assets of definite useful life was approximately $4,350 in 2009, $4,088 in 2008 and $2,654 in 2007, recognized within
operation costs and expenses, except for approximately $215 in 2007 as a result of intangible assets related to customers, which were recognized within
“Other expenses, net.” During 2009, impairment losses related to intangible assets of definite life were recognized for approximately $42.
During 2009, CEMEX capitalized financing costs associated with its Financing Agreement (note 13A) for approximately $8,378 (US$616). Under MFRS,
CEMEX’s debt Financing Agreement qualified as the issuance of new debt and the extinguishment of the old facilities. Consequently, approximately $608
(US$45) of deferred financing costs associated with the extinguished debt were recognized immediately in the income statement.
In April 2008, in connection with the purchase of Rinker Group Limited (“Rinker”) (note 12A), considering information and evidence which was unavailable
at the end of 2007, CEMEX defined as intangible assets of definite useful life, extraction permits in the cement and aggregates sector in the United States
for an amount of $10,156, and assigned an average useful life of 30 years. Amortization of these assets was recorded prospectively from the change in
definition. In 2007, those assets were identified as having indefinite life.
Goodwill
Goodwill is recognized at the acquisition date based on the preliminary allocation of the purchase price. If applicable, goodwill is subsequently adjusted
for any correction to the preliminary assessment given to the assets acquired and/or liabilities assumed, within the twelve-month period after purchase.
Goodwill balances by reporting unit as of December 31, 2009 and 2008, are the following:
2009 2008
North America
United States $ 116,784 123,428
Mexico 6,354 6,412
Europe
Spain 9,217 9,069
United Kingdom 4,569 4,350
France 3,635 3,638
Rest of Europe 1 587 697
Central and South America and the Caribbean
Colombia 5,109 5,063
Dominican Republic 226 231
Rest of Central and South America and the Caribbean 2 951 985
Africa and Middle East
United Arab Emirates 1,373 1,557
Egypt 231 231
Asia
Philippines 1,425 1,505
Others
Other reporting units 3 366 375
$ 150,827 157,541
1 This segment includes reporting units in Czech Republic and Latvia.
2 This segment includes reporting units in Costa Rica, Panama and Puerto Rico.
3 This segment primarily consists of CEMEX’s subsidiary in the information technology and software development business.