Goodwill and Other Intangible Assets

9 Months Ended

Nov. 30, 2012

Goodwill and Other Intangible Assets [Abstract]

Goodwill and Other Intangible Assets

5. Goodwill and Other Intangible Assets

Goodwill represents the excess of the purchase price over the fair value of net assets of acquired businesses and is not amortized. Goodwill and indefinite-lived intangibles are evaluated for impairment on an annual basis, or more frequently if impairment indicators arise, using a fair-value-based test that compares the fair value of the asset to its carrying value. Fair values of reporting units are typically calculated using a factor of expected earnings before interest, taxes, depreciation, and amortization. The Company must make assumptions regarding estimated future cash flows and other factors to determine the fair value of the respective assets in assessing the recoverability of its goodwill and other intangibles. If these estimates or the related assumptions change, the Company may be required to record impairment charges for these assets in the future.

The cost of intangible assets is based on fair values at the date of acquisition. Intangible assets with determinable lives are amortized on a straight-line basis over their estimated useful life (between 1 and 10 years). Trademarks with indefinite lives and a net book value of $63.4 million at November 30, 2012 are evaluated for impairment on an annual basis, or more frequently if impairment indicators arise. The Company assesses the recoverability of its definite-lived intangible assets primarily based on its current and anticipated future undiscounted cash flows.

The carrying amount and accumulated amortization of the Company’s intangible assets at each balance sheet date are as follows (in thousands):

As of November 30, 2012	Weighted Average Remaining Life (in years)		Gross Carrying Amount		Accumulated Amortization		Net
Amortized intangible assets
Trade names		—	$	1,234	$	1,234	$	—
Customer lists		6.6		37,887		16,990		20,897
Noncompete		—		500		500		—
Patent		5.2		773		102		671
Total		6.4	$	40,394	$	18,826	$	21,568
As of February 29, 2012
Amortized intangible assets
Trade names		0.8	$	1,234	$	1,139	$	95
Customer lists		7.2		37,887		14,699		23,188
Noncompete		—		500		500		—
Patent		6.0		773		5		768
Total		7.0	$	40,394	$	16,343	$	24,051

	November 30, 2012		February 29, 2012
Non-amortizing intangible assets
Trademarks	$	63,378	$	63,378

Aggregate amortization expense for the nine months ended November 30, 2012 and 2011 was $2.5 million and $1.8 million, respectively.

The Company’s estimated amortization expense for the current and next five fiscal years ending in February of the stated year is as follows (in thousands):

2013	$	3,278
2014		3,180
2015		3,063
2016		3,004
2017		3,004
2018		2,765

The following table represents changes in the carrying amount of goodwill as of the dates indicated (in thousands):

	Print		Apparel
	Segment		Segment
	Total		Total		Total
Balance as of February 28, 2011	$	42,792	$	74,549	$	117,341
Goodwill acquired		4,293		—		4,293
Goodwill impairment		—		—		—
Balance as of February 29, 2012		47,085		74,549		121,634
Goodwill acquired adjustment		175		—		175
Goodwill impairment		—		—		—
Balance as of November 30, 2012	$	47,260	$	74,549	$	121,809

During the fiscal year ended February 29, 2012, $4.3 million was added to goodwill related to the acquisition of PrintXcel and Printegra assets. During the nine months ended November 30, 2012, an adjustment of $0.2 million reflects a revised estimate in accounts receivable, inventories, accrued expenses, and property, plant and equipment, net of adjustment to the purchase price, related to the acquisition of PrintXcel and Printegra assets during fiscal year 2012.