Albertsons 2009 Annual Report Download - page 57

Download and view the complete annual report

Please find page 57 of the 2009 Albertsons annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 104

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104

In December 2008, the FASB issued FSP FAS 132(R)-1, “Employers’ Disclosures about Postretirement Benefit
Plan Assets.” FSP FAS 132(R)-1 provides additional guidance regarding disclosures about plan assets of
defined benefit pension or other postretirement plans. FSP FAS 132(R)-1 will be effective for the Company’s
fiscal year beginning March 1, 2009. The adoption of FSP FAS 132(R)-1 will result in enhanced disclosures,
but will not otherwise have an impact on the Company’s consolidated financial statements.
NOTE 3—GOODWILL AND INTANGIBLE ASSETS
Changes in the Company’s Goodwill and Intangible assets consisted of the following:
February 24,
2007
Additions/
Amortization
Other net
adjustments
February 23,
2008
Additions/
Amortization Impairment
Other net
adjustments
February 28,
2009
Goodwill $5,921 $ 57 $ 979 $6,957 $ — $(3,223) $ 14 $3,748
Intangible assets:
Trademarks and
tradenames—indefin-
ite lived $1,384 $ 1 $ (15) $1,370 $ — $ (301) $ — $1,069
Favorable operating
leases, customer lists,
customer
relationships and
other (accumulated
amortization of $197
and $141, as of
February 28, 2009
and February 23,
2008, respectively) 1,130 12 (425) 717 14 — (25) 706
Non-compete
agreements
(accumulated
amortization of $4
and $9 as of
February 28, 2009
and February 23,
2008, respectively) 13 3 (1) 15 1 — (6) 10
Total intangible assets 2,527 16 (441) 2,102 15 (301) (31) 1,785
Accumulated amortization (77) (55) (18) (150) (65) — 14 (201)
Total intangible assets, net $2,450 $1,952 $1,584
In accordance with SFAS No. 142, the Company applies a fair value-based impairment test to the net book
value of goodwill and indefinite-lived intangible assets on an annual basis and on an interim basis if certain
events or circumstances indicate that an impairment loss may have occurred. For the third quarter of fiscal
2009, the Company’s stock price had a significant and sustained decline and book value per share substantially
exceeded the stock price. Consistent with SFAS No. 142, the Company performed an interim impairment test
of goodwill and indefinite-lived intangible assets at the end of the third quarter of fiscal 2009. Although this
analysis had not been completed due to its complexity, the Company recorded a preliminary estimate of
impairment charges in the third quarter of $3,250, comprised of $3,000 to goodwill at certain Retail food
reporting units and $250 to indefinite-lived trademarks and tradenames related to the Acquired Trademarks. In
the fourth quarter, the Company finalized the impairment analysis and recorded additional impairment charges
of $274, comprised of $223 to goodwill for the same Retail food reporting units and $51 to the same
indefinite-lived trademarks and tradenames and other intangible assets. The impairment of goodwill and
indefinite-lived intangible assets reflects the significant decline in the market price of the Company’s common
stock as of the end of the third quarter of fiscal 2009 as well as the impact of the unprecedented decline in the
economy on the Company’s plan. The Company did not record any impairment losses related to goodwill or
intangible assets during fiscal 2008.
53