Energizer 2012 Annual Report Download - page 73

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ENERGIZER HOLDINGS, INC.
(Dollars in millions, except per share and percentage data)
(4) Goodwill and Intangible Assets
Goodwill and intangible assets deemed to have an indefinite life are not amortized, but reviewed annually for impairment of
value or when indicators of a potential impairment are present. As part of our business planning cycle, we performed our
annual impairment testing in the fourth quarter of fiscal 2012, 2011 and 2010. There were no indications of impairment of
goodwill noted during this testing.
The following table represents the carrying amount of goodwill by segment at September 30, 2012:
Household
Products
Personal
Care Total
Balance at October 1, 2011 $ 36.9 $ 1,438.4 $ 1,475.3
Cumulative translation adjustment 0.4 (6.2)(5.8)
Balance at September 30, 2012 $ 37.3 $ 1,432.2 $ 1,469.5
The Company had indefinite-lived intangible assets of $1,701.9 at September 30, 2012 and $1,703.6 at September 30, 2011.
Changes in indefinite-lived intangible assets are due primarily to changes in foreign currency translation.
In addition, we completed impairment testing on indefinite-lived intangible assets other than goodwill, which are trademarks/
brands used in our various product categories. No impairment was indicated as a result of this testing. However, the recorded
values of such intangible assets from more recent acquisitions, such as the Playtex acquisition, are often more susceptible to an
impairment risk, if operating results or macroeconomic conditions deteriorate. We utilized a discounted cash flow model using
an excess earnings valuation technique to test the brands acquired in the Playtex acquisition for impairment. Key assumptions
included a discount rate of 8.00% and a terminal growth rate of 2.75%. While no impairment was indicated during this testing,
the indicated estimated fair value for two brands, Playtex and Wet Ones, were relatively close to the carrying value at
approximately 115% of the carrying value (approximately $650) for the Playtex brand and approximately 106% of the carrying
value (approximately $200) for the Wet Ones brand.
Total amortizable intangible assets at September 30, 2012 are as follows:
Gross
Carrying
Amount
Accumulated
Amortization Net
Tradenames / Brands $ 18.7 $ 11.6 $ 7.1
Technology and patents 76.7 49.0 27.7
Customer-related / Other 164.0 47.0 117.0
Total amortizable intangible assets $ 259.4 $ 107.6 $ 151.8
Amortizable intangible assets, with a weighted average remaining life of approximately thirteen years, are amortized on a
straight-line basis over expected lives of 3 years to 20 years.
Amortization expense for intangible assets totaled $22.8 for the current year. Estimated amortization expense for amortizable
intangible assets for the years ending September 30, 2013, 2014, 2015, 2016 and 2017 is approximately $20.7, $17.4, $15.2,
$15.2 and $14.8 , respectively, and $68.5 thereafter.
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