Shutterfly 2013 Annual Report Download - page 85

Download and view the complete annual report

Please find page 85 of the 2013 Shutterfly 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 124

  • 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
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124

The increase in goodwill for the year ended December 31, 2013 was a result of the acquisitions of
MyPublisher, Inc., R&R Images, Inc. and BorrowLenses LLC.
The increase in goodwill for the year ended December 31, 2012 was a result of the acquisitions of
Photoccino, Ltd., Penguin Digital, Inc., and ThisLife.com, Inc.
Accrued Liabilities
December 31,
2013 2012
(in thousands)
Accrued production costs ..................................... $ 34,525 $ 22,534
Accrued marketing expenses ................................... 26,203 21,371
Accrued income and sales tax .................................. 16,465 15,002
Accrued compensation ....................................... 14,872 13,904
Accrued consulting .......................................... 4,548 4,200
Accrued purchases .......................................... 3,723 5,239
Capital lease obligations ...................................... 1,530 —
Accrued other ............................................. 5,582 6,222
$ 107,448 $ 88,472
Other Liabilities
December 31,
2013 2012
(in thousands)
Other liabilities ............................................ $ 26,341 $ 11,720
Other liabilities includes the long-term portion of capital lease obligations, deferred rent, and
financing obligations related to the Company’s build-to-suit leases. The increase during the year ended
December 31, 2013 was primarily related to additions of financing obligations for the Company’s Fort Mill,
South Carolina and Shakopee, Minnesota production facilities and capital leases for production
equipment.
Note 4 — Acquisitions
Business Combinations
BorrowLenses LLC
On October 24, 2013, the Company acquired BorrowLenses LLC (‘‘BorrowLenses’’) for a total
aggregate cash purchase price of $36.9 million, or $35.8 million net of cash acquired. BorrowLenses is a
premier online marketplace for photographic and video equipment rentals. The acquisition was accounted
for as a non-taxable purchase transaction and, accordingly, the purchase price has been allocated to the
acquired tangible assets, liabilities assumed, and identifiable intangible assets acquired based on their
estimated fair values on the acquisition date. The excess of the purchase price over the aggregate fair
values was recorded as goodwill. For federal income tax purposes, an election was made to treat the
non-taxable transaction as an asset acquisition.
83