Goodwill and Other Intangible Assets

12 Months Ended

Dec. 31, 2016

Goodwill And Intangible Assets Disclosure [Abstract]

Note 5. Goodwill and Other Intangible Assets

As a result of the Separation, goodwill of approximately $657.9 million was distributed with LSC and Donnelley Financial. The goodwill distributed consisted of the goodwill of the former Publishing and Retail Services segment and certain portions of the goodwill of the Strategic Services segment including the entire goodwill of the former financial reporting unit and a portion of each of the digital and creative solutions and logistics reporting units. The portion of the digital and creative solutions’ and logistics’ reporting units goodwill distributed was determined based upon the relative fair value as of October 1, 2016 of the businesses being disposed of in comparison to the overall fair value of the reporting unit as a whole. This resulted in the allocation of $25.5 million, or all, of the goodwill of the digital and creative solutions reporting unit and $104.2 million of the logistics reporting unit to the LSC disposal group.

The changes in the carrying amount of goodwill for the years ended December 31, 2016 and 2015 were as follows:

	Variable Print			Strategic Services			International			Total
Net book value as of January 1, 2015
Goodwill	$	1,794.6		$	336.4		$	1,184.4			3,315.4
Accumulated impairment losses		(1,022.9	)		(148.7	)		(1,044.6	)		(2,216.2	)
Total		771.7			187.7			139.8			1,099.2
Acquisitions		2.3			7.5			5.4			15.2
Foreign exchange and other adjustments		(2.4	)		—			(8.3	)		(10.7	)
Impairment charges		—			—			(18.0	)		(18.0	)
Net book value as of December 31, 2015
Goodwill		1,794.5			343.9			1,098.0			3,236.4
Accumulated impairment losses		(1,022.9	)		(148.7	)		(979.1	)		(2,150.7	)
Total	$	771.6		$	195.2		$	118.9		$	1,085.7
Acquisitions		21.2			21.3			—			42.5
Foreign exchange and other adjustments		7.5			—			(5.9	)		1.6
Impairment charges		(527.8	)		—			—			(527.8	)
Net book value as of December 31, 2016
Goodwill		1,823.0			365.2			1,017.9			3,206.1
Accumulated impairment losses		(1,550.5	)		(148.7	)		(904.9	)		(2,604.1	)
Total	$	272.5		$	216.5		$	113.0		$	602.0

During the fourth quarter of December 31, 2016, the Company recorded non-cash charges of $416.2 million and $111.6 million to reflect the impairment of goodwill for the commercial and digital print and statement printing reporting units within the Variable Print segment. During the year ended December 31, 2015, the Company recorded non-cash charges of $18.0 million to reflect the impairment of goodwill in the International segment. See Note 4, Restructuring, Impairment and Other Charges, for further discussion regarding these impairment charges.

The components of other intangible assets at December 31, 2016 and 2015 were as follows:

	December 31, 2016							December 31, 2015
	Gross							Gross
	Carrying		Accumulated			Net Book		Carrying		Accumulated			Net Book
	Amount		Amortization			Value		Amount		Amortization			Value

Customer relationships	$	517.9	$	(370.7	)	$	147.2	$	586.5	$	(389.9	)	$	196.6
Patents		2.0		(2.0	)		—		98.3		(98.3	)		—
Trademarks, licenses and agreements		26.2		(24.4	)		1.8		24.5		(23.8	)		0.7
Trade names		36.8		(13.9	)		22.9		35.7		(12.0	)		23.7
Total other intangible assets	$	582.9	$	(411.0	)	$	171.9	$	745.0	$	(524.0	)	$	221.0

During the year ended December 31, 2016, the Company recorded non-cash charges of $29.7 million primarily for the impairment of certain acquired customer relationship intangible assets in the commercial and digital print reporting unit in the Variable Print segment. During the year ended December 31, 2015, the Company recorded non-cash charges of $11.9 million for the impairment of intangible assets, including $9.2 million and $2.2 million related to the impairment of certain acquired customer relationship intangible assets in the previous labels reporting unit within the Variable Print segment and the Latin America reporting unit within the International segment, respectively.

During the years ended December 31, 2016 and 2015, the Company recorded additions to other intangible assets of $14.1 million and $5.2 million, respectively, for acquisitions during those years, the components of which were as follows:

	December 31, 2016				December 31, 2015
	Amount		Weighted Average Amortization Period		Amount		Weighted Average Amortization Period
Customer relationships	$	11.0		10.5	$	4.9		9.2
Trade names (amortizable)		1.4		4.7		—		0.0
Non-compete agreements		1.7		3.3		0.3		4.3
Total additions	$	14.1			$	5.2

Amortization expense for other intangible assets was $33.7 million, $46.2 million and $50.2 million for the years ended December 31, 2016, 2015 and 2014, respectively.

The following table outlines the estimated annual amortization expense related to other intangible assets as of December 31, 2016:

	Amount
2017	$	28.6
2018		27.8
2019		24.1
2020		20.3
2021		20.0
2022 and thereafter		51.1
Total	$	171.9

- Definition

The entire disclosure for the aggregate amount of goodwill and a description of intangible assets, which may include (a) for amortizable intangible assets (also referred to as finite-lived intangible assets), the carrying amount, the amount of any significant residual value, and the weighted-average amortization period, (b) for intangible assets not subject to amortization (also referred to as indefinite-lived intangible assets), the carrying amount, and (c) the amount of research and development assets acquired and written off in the period, including the line item in the income statement in which the amounts written off are aggregated, if not readily apparent from the income statement. Also discloses (a) for amortizable intangibles assets in total and by major class, the gross carrying amount and accumulated amortization, the total amortization expense for the period, and the estimated aggregate amortization expense for each of the five succeeding fiscal years, (b) for intangible assets not subject to amortization the carrying amount in total and by major class, and (c) for goodwill, in total and for each reportable segment, the changes in the carrying amount of goodwill during the period (including the aggregate amount of goodwill acquired, the aggregate amount of impairment losses recognized, and the amount of goodwill included in the gain (loss) on disposal of a reporting unit). If any part of goodwill has not been allocated to a reportable segment, discloses the unallocated amount and the reasons for not allocating. For each impairment loss recognized related to an intangible asset (excluding goodwill), discloses: (a) a description of the impaired intangible asset and the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method for determining fair value, (c) the caption in the income statement or the statement of activities in which the impairment loss is aggregated, and (d) the segment in which the impaired intangible asset is reported. For each goodwill impairment loss recognized, discloses: (a) a description of the facts and circumstances leading to the impairment, (b) the amount of the impairment loss and the method of determining the fair value of the associated reporting unit, and (c) if a recognized impairment loss is an estimate not finalized and the reasons why the estimate is not final. May also disclose the nature and amount of any significant adjustments made to a previous estimate of an impairment loss.

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