Redbox 2013 Annual Report Download - page 72

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63
Sale of Business for more information. This included reclassifying total charges related to our Orango concept of $5.6 million
from depreciation and other expense and $0.5 million from direct operating expense for the year ended December 31, 2013 to
Loss from discontinued operations, net of tax. These charges were previously not presented as discontinued operations within
our quarterly reports as they were not material on a stand-alone basis. Upon discontinuing the three additional concepts in the
fourth quarter of 2013, we reclassified the results of all four concepts as Discontinued Operations.
During the second quarter of 2013, we entered into an arrangement to sell certain kiosks previously acquired from NCR (the
“NCR Kiosks”) through the sale of a previously consolidated entity which held certain of the NCR kiosks with a net book value
of $12.4 million. Total proceeds from the sale of the entity were $11.8 million and are recorded within proceeds from sale of
property and equipment within our Consolidated Statements of Cash Flows. As a result of this sale and certain reorganizations
we recorded a one-time tax benefit as described in Note 12: Income Taxes From Continuing Operations.
During the third quarter of 2013, we acquired ecoATM, which included $23.2 million in property and equipment measured at
fair value as of the acquisition date and is included in the table above. See Note 3: Business Combinations for more
information.
NOTE 5: GOODWILL AND OTHER INTANGIBLE ASSETS
Goodwill
The carrying amount of goodwill was as follows:
Dollars in thousands
Goodwill balance at December 31, 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 309,860
Purchase price allocation adjustment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . (14,766)
Adjusted balance at December 31, 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 295,094
Goodwill from acquisition of ecoATM. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 264,213
Goodwill balance at December 31, 2013 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 559,307
Goodwill by Segment
The carrying amount of goodwill by segment was as follows:
December 31,
2013 2012
Dollars in thousands (As adjusted)
Redbox . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 138,743 $ 138,743
Coinstar . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 156,351 156,351
New Ventures. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 264,213—
Total goodwill. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . $ 559,307 $ 295,094
During the second quarter of 2013, we finalized the purchase price allocation associated with the NCR Asset Acquisition
resulting in a $14.8 million decrease in Goodwill. During the third quarter of 2013 we acquired ecoATM resulting in a $264.2
million increase in Goodwill. See Note 3: Business Combinations for more information.
We utilized a qualitative assessment for our annual Goodwill impairment analysis, performed as of November 30, 2013, and
determined that it was not more likely than not that the fair value of each of our reporting units was less than its applicable
carrying value. Accordingly, it was not necessary to perform the two-step impairment test and no goodwill impairment was
recognized in 2013.