Estee Lauder 2015 Annual Report Download - page 96

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THE EST{E LAUDER COMPANIES INC. 93
Other intangible assets consist of the following:
JUNE 30, 2015 JUNE 30, 2014
Gross Accumulated Total Net Gross Accumulated Total Net
Carrying Value Amortization Book Value Carrying Value Amortization Book Value
(In millions)
Amortizable intangible assets:
Customer lists and other $294.4 $228.7 $ 65.7 $268.3 $216.7 $ 51.6
License agreements 43.0 43.0 — 43.0 43.0 —
$337.4 $271.7 65.7 $311.3 $259.7 51.6
Non-amortizable
intangible assets:
Trademarks and other 260.9 105.7
Total intangible assets $326.6 $157.3
The aggregate amortization expense related to amortizable intangible assets for fiscal 2015, 2014 and 2013 was $13.7
million, $12.4 million and $12.5 million, respectively. The estimated aggregate amortization expense for each of the next
five fiscal years is as follows:
FISCAL 2016 2017 2018 2019 2020
(In millions)
Estimated aggregate amortization expense $15.3 $13.3 $11.8 $11.0 $4.0
Fiscal 2013 Impairment Charges
As of the Company’s annual step-one goodwill impairment test on April 1, 2013, the Company determined that the
carrying value of the Darphin reporting unit exceeded its fair value. As a result, the Company recorded an impairment
charge for the remainder of the goodwill related to the Darphin reporting unit of $9.6 million. The fair value of the report-
ing unit was based upon the income approach, utilizing estimated cash flows and a terminal value, discounted at a rate of
return that reflects the relative risk of cash flows. The Company also determined that the carrying value of the Darphin
trademark exceeded its estimated fair value, which was based on the use of a royalty rate to determine discounted pro-
jected future cash flows (“relief-from-royalty method”). As a result, the Company recognized an impairment charge of $8.1
million for the remaining carrying value of the related trademark. These impairment charges were reflected in the skin care
product category and in the Europe, the Middle East & Africa region.
NOTE 8
—
INCOME TAXES
The provision for income taxes is comprised of the following:
YEAR ENDED JUNE 30 2015 2014 2013
(In millions)
Current:
Federal $236.8 $338.2 $261.7
Foreign 251.2 265.4 241.5
State and local 31.8 20.5 24.3
519.8 624.1 527.5
Deferred:
Federal (55.5) (41.7) (35.2)
Foreign 2.1 (18.6) (41.3)
State and local 0.8 3.9 0.4
(52.6) (56.4) (76.1)
$467.2 $567.7 $451.4
Earnings before income taxes include amounts contributed by the Company’s foreign operations of approximately $1,420
million, $1,384 million and $1,220 million for fiscal 2015, 2014 and 2013, respectively. A portion of these earnings are
taxed in the United States.