Reebok 2014 Annual Report Download - page 216

adidas Group
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2014 Annual Report
Consolidated Financial Statements
212
2014
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04.8
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Notes
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Notes to the Consolidated Statement of Financial Position
Trademarks and other intangible assets consist of the following:
Trademarks and other intangible assets
(€ in millions) Dec. 31, 2014 Dec. 31, 2013
Reebok 1,276 1,123
Rockport – 158
Reebok-CCM Hockey 107 94
Other 49 44
Trademarks 1,432 1,419
Software, patents and concessions 772 720
Less: accumulated amortisation and impairment losses 609 556
Other intangible assets 162 164
Trademarks and other intangible assets 1,594 1,583
At December 31, 2014, trademarks, mainly related to the acquisition of Reebok International Ltd. (USA) in 2006
and Ashworth, Inc. in 2008, have indefinite useful lives. This is due to the expectation of permanent use of the
acquired brand names.
At December 31, 2014, the Rockport trademark was transferred to ‘Assets held for sale’ due to the concrete
plans to sell the Rockport operating segment and is impaired by € 68 million in connection with the fair value
measurement of the disposal group
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SEE NOTE 11.
The reported other trademarks mainly relate to the brand names Ashworth, Adams Golf and Five Ten.
The Group tests at least on an annual basis whether trademarks with indefinite useful lives are impaired. This
requires an estimation of the fair value less costs to sell of the trademarks. As part of this estimation, the Group
is required to make an estimate of the expected future trademark-specific sales and appropriate arm’s length
notional royalty rates and also to choose a suitable discount rate in order to calculate the present value of those
cash flows. There was no need for impairment for the years ending December 31, 2014 and 2013.
Future changes in expected cash flows and discount rates may lead to impairments of the accounted
trademarks in the future.
As part of the goodwill impairment test, the Reebok trademark is allocated on a pro rata basis to the
cash-generating units. Thereof, the major shares relate to Retail CIS (€ 276 million), Retail North America
(€ 209 million), Wholesale Western Europe (€ 201 million), Wholesale Latin America (€ 119 million) and Wholesale
North America (€ 117 million).
Amortisation expenses for intangible assets with definite useful lives were € 58 million and € 52 million for
the years ending December 31, 2014 and 2013, respectively
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SEE NOTE 31.
For details see Attachment I to the consolidated financial statements
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SEE STATEMENT OF MOVEMENTS OF
INTANGIBLE AND TANGIBLE ASSETS, P. 246.
Long-term financial assets primarily include a 8.33% investment in FC Bayern München AG (2013: 9.1%) of
€ 80 million (2013: € 80 million). The percentage share held in the investment has decreased due to the issuance
of new shares which have been bought by another shareholder. This investment is classified as ‘fair value
through profit or loss’ and recorded at fair value. This equity security does not have a quoted market price in an
active market. Therefore, existing contractual arrangements were used in order to calculate the fair value as at
December 31, 2014.
The line item ‘Investments and other financial assets’ comprises the shares in Immobilieninvest und
Betriebsgesellschaft Herzo-Base GmbH & Co. KG as well as other minority shareholdings amounting to
€ 16 million (2013: € 13 million) which are classified as ‘Available-for-sale’ and measured at amortised cost as a
reliable determination of the fair value is impossible without having concrete negotiations regarding a sale. These
shares are unlisted and do not have an active market. There is no intention to sell these shares.
Additionally, long-term financial assets include investments which are mainly invested in insurance products
and are measured at fair value, as well as other financial assets.
14
Trademarks and other
intangible assets
15
Long-term financial
assets