Goodwill and Intangible Assets

3 Months Ended

May 01, 2021

Goodwill and Intangible Assets

Goodwill and Intangible Assets

Note 8    Goodwill and Intangible Assets

Goodwill and intangible assets were as follows:

($ thousands)	May 1, 2021		May 2, 2020		January 30, 2021
Intangible Assets
Famous Footwear	$	2,800	$	2,800	$	2,800
Brand Portfolio		342,083		365,888		342,083
Total intangible assets		344,883		368,688		344,883
Accumulated amortization		(112,915)		(99,996)		(109,768)
Total intangible assets, net		231,968		268,692		235,115
Goodwill
Brand Portfolio		4,956		4,956		4,956
Total goodwill		4,956		4,956		4,956
Goodwill and intangible assets, net	$	236,924	$	273,648	$	240,071

The Company’s intangible assets as of May 1, 2021, May 2, 2020 and January 30, 2021 were as follows:

($ thousands)	May 1, 2021
	Estimated Useful Lives			Accumulated		Accumulated
	(In Years)	Cost Basis (1)		Amortization		Impairment		Net Carrying Value
Trade names	2 - 40	$	299,488	$	104,459	$	10,200	$	184,829
Trade names	Indefinite		107,400		—		92,000		15,400
Customer relationships	15 - 16		44,200		8,456		4,005		31,739
		$	451,088	$	112,915	$	106,205	$	231,968
	May 2, 2020
	Estimated Useful Lives			Accumulated		Accumulated
	(In Years)	Cost Basis		Amortization		Impairment		Net Carrying Value
Trade names	15 - 40	$	288,788	$	94,294	$	—	$	194,494
Trade names	Indefinite		118,100		—		82,400		35,700
Customer relationships	15 - 16		44,200		5,702		—		38,498
		$	451,088	$	99,996	$	82,400	$	268,692
	January 30, 2021
	Estimated Useful Lives			Accumulated		Accumulated
	(In Years)	Cost Basis (1)		Amortization		Impairment		Net Carrying Value
Trade names	2 - 40	$	299,488	$	101,919	$	10,200	$	187,369
Trade names	Indefinite		107,400		—		92,000		15,400
Customer relationships	15 - 16		44,200		7,849		4,005		32,346
		$	451,088	$	109,768	$	106,205	$	235,115

(1) The Via Spiga trade name was reclassified from indefinite-lived trade names to definite-lived trade names.  The remaining carrying value of $0.5 million is being amortized over two years.

Amortization expense related to intangible assets was $3.1 million and $3.2 million for the thirteen weeks ended May 1, 2021 and May 2, 2020, respectively.  The Company estimates that amortization expense related to intangible assets will be approximately $12.6 million in 2021, $12.1 million in 2022, $11.9 million in 2023, and $11.0 million in 2024 and 2025.

Goodwill is tested for impairment at least annually, or more frequently if events or circumstances indicate it might be impaired, using either the qualitative assessment or a quantitative fair value-based test.  During the first quarter of 2020, as a result of the significant decline in the Company’s share price and market capitalization and the impact of COVID-19 on the Company’s business operations, the Company determined that an interim assessment of goodwill was required.  A quantitative assessment was performed for all reporting units as of May 2, 2020.  The assessment indicated that the carrying value of the goodwill associated with the Brand Portfolio and Vionic reporting

units was impaired, resulting in total goodwill impairment charges of $240.3 million.  The Company recorded no goodwill impairment charges during the thirteen weeks ended May 1, 2021.

Indefinite-lived intangible assets are tested for impairment as of the first day of the fourth quarter of each fiscal year unless events or circumstances indicate an interim test is required.  As a result of the triggering event from the economic impacts of COVID-19, an interim assessment was performed as of May 2, 2020.  The indefinite-lived intangible asset impairment review resulted in total impairment charges of $22.4 million for the thirteen weeks ended May 2, 2020, including $12.2 million associated with the indefinite-lived Allen Edmonds trade name and $10.2 million of impairment associated with the indefinite-lived Via Spiga trade name.  The carrying value of the Via Spiga trade name of $0.5 million is being amortized over approximately two years.  In addition to the interim assessment, the Company tested the indefinite-lived intangible assets as of the first day of the fourth fiscal quarter.  As a result of the impairment indicator for Allen Edmonds, the Company also tested the definite-lived Allen Edmonds customer relationships intangible asset.  Those assessments resulted in additional impairment totaling $23.8 million, consisting of $19.8 million associated with the Allen Edmonds trade name and $4.0 million associated with the Allen Edmonds customer relationships intangible asset.  The Company recorded no impairment charges during the thirteen weeks ended May 1, 2021.